August 21 2016
    Canberra Times

Bank profits and complaints skyrocket, Labor says only royal commission will do


Bank profits and the number of complaints against them have both skyrocketed in recent years, according to new research that questions the adequacy of "cop out" bodies to keep financial institutions in check.   

According to the analysis, conducted for the Labor Party by the Parliamentary Library, complaints about banks to the Financial Ombudsman Service have risen 60 per cent between 2008 and 2015, from 19,107 to 31,895 a year.


It also points to a 145 per cent increase in credit card complaints from 6731 a year in 2008-09 to 16,458 in 2014-15 and notes the booming profits in the industry, including the Commonwealth Bank's $9.1 billion in 2015-16, Westpac's $8.2 billion, ANZ's $7.8 billion and NAB's $5.8 billion.

Opposition Leader Bill Shorten said a tribunal to field complaints, being considered by the government, is a "soft touch" that "simply won't cut it" as the non-government organisation FOS already exists.   

"While the banks have been getting richer, the rip-offs and rackets have been getting worse," Mr Shorten said.


"The Coalition MPs who say they want to stop these rip-offs have a duty to stand up to [Prime Minister Malcolm] Turnbull and tell him anything less than a royal commission is just another cop out.

"There's already an ombudsman in place but the number of people getting ripped off has been going up and up".   

The analysis shows complaints about deposits are up 110 per cent since 2008 and up 62 per cent for insurance.

Since April, Labor has been proposing the full commonwealth inquiry into banks and the financial services industry after a string of ethical scandals, arguing it is the only way to deliver "systemic, structural and cultural change".

Criticism intensified early this month when the big four banks declined to pass on the full interest rate cut to their mortgage customers.

Nationals MP John Williams, a veteran campaigner against bank misconduct who wants a royal commission, has also embraced the idea of a tribunal and Mr Turnbull has said "the government is certainly looking at that".

"In terms of improving the way customers and particularly retail customers are dealt with, we're very open to looking at action in that regard," Mr Turnbull said.

Didnt the x merchant bankers wet lettuce leaf do the trick ?

Labor had some good polices during the election..

an investigation into the greedy banks was one...

taking negative gearing off second hand housing was another...

its a pity the rest of their polices were utter duds...

Technically I suppose companies (and departments) should charge where there is an extra cost associated with - but not obviously more as that is now a revenue measure. 

Morally, should they?  Cross subsiding exists in industry - e.g. petrol fuel discounts, or Aussie Post stamps.  Perhaps those on pensions, health care cards, veterans etc can be exmpet.