Dumping of Future of Financial Advice reforms shows how bank lobbyists pervert democracy

Business Date July 20, 2014

Michael West

"Our four big banks never stopped nagging the Commonwealth government to permit only two. When I became treasurer, on day two, the NAB visited me wanting to buy the ANZ. AMP visited me on day three wanting to buy Westpac." – John Kerin, in Rodney Cavalier's newsletter last November.

It is rare to get a decent insight into the back-room dealings between government and big business. This observation from former treasurer John Kerin confirms all suspicions: bank lobbyists are forever roaming about Canberra leaning on politicians and perverting democracy by exacting undue influence over government policy. 

The Abbott government has put this influence in stark relief in recent times by winding back the Future of Financial Advice (FOFA) reforms. Dumping FOFA is hardly in anybody's interest, except for the big banks that control 80 per cent of the financial advice market. They nagged for the repeal of FOFA and they got everything they nagged for.

The four pillars policy – which bans mergers and takeovers of the big four banks – has been vital to the resilience of Australia's financial system.  The reason the major banks lobby to have four pillars scrapped is because their executives stand to gain millions in bonuses and share option schemes if they can invite a takeover...............Read more: