Pardon me for being just a little suspicious, but when I see an avalanche of enthusiasm from such reputable institutions as the Morrison government, the Murdoch media and the Australian Banking Association (anyone remember the Hayne royal commission?) about the proposed “reform” of the National Consumer Credit Protection Act, I smell a very large rodent. “Reform” here is effectively code language for repeal. And it means the repeal of major legislation introduced by my government to bring about uniform national laws to protect Australian consumers from unregulated and often predatory lending practices.
The banks of course have been ecstatic at Morrison’s announcement, chiming in with the government’s political chimeric that allowing the nation’s lenders once again to just let it rip was now essential for national economic recovery. Westpac, whose reputation was shredded during the royal commission, was out of the blocks first in welcoming the changes: CEO Peter King said they would “reduce red tape”, “speed up the process for customers to obtain approval”, and help small businesses access credit to invest and grow.
And right on cue, Westpac shares were catapulted 7.2% to $17.54 just before midday on the day of announcement. National Australia Bank was up more than 6% at $18.26, ANZ up more than 5% at $17.76, and Commonwealth Bank was trading almost 3.5% higher at $66.49. The popping of champagne corks could be heard right around the country as the banks, once again, saw the balance of market power swing in their direction and away from consumers. And that means more profit and less consumer protection.
Related: Frydenberg’s move to dump lending laws ‘shortsighted’, consumer groups say
A little bit of history first. Back in the middle of the global financial crisis, when the banks came on