Mr MURPHY (10:24 AM) —I rise this morning to address the Financial Sector (Collection of Data) Bill 2001. The purpose of this legislation is to provide APRA with the power to determine the information which must be provided by certain corporations and to place an obligation on those corporations to provide that information. APRA was created in 1999 as an amalgam of the Insurance and Superannuation Commission, the banking supervision unit of the Reserve Bank, and the Australian financial institutions commissions of the states and territories, which supervise building societies, credit unions and financial institutions then incorporated in state and territory legislation. The finance sector has been both the subject and the source of much change in the last two decades. It is perhaps the most internationalised of our industry sectors and has been undergoing huge structural adjustment, which has attracted much community, media and political scrutiny.

The closure of bank branches, not just in rural areas and provincial towns but in the suburbs of metropolitan cities, has caused much angst amongst banking customers and communities. I am very pleased that, in my own electorate of Lowe, where some 13 branches have closed in the period I have been the member, there is a very active group led by Marlene Doran, the President of the Homebush Main Street Committee, to get the first community bank up and running in Homebush in Sydney and another over in the Haberfield area. Councillor Emma Brooks-Maher from Ashfield Council is leading a very spirited campaign to get community banks up and running. Quite plainly, the community are outraged at the campaign by the banks to make profits at all costs, with no interest in the very customers who have provided the huge profits over the years. The banks are only interested in rewarding their shareholders. I look forward to the day when my electorate has a number of community banks to take on the big bastards.

From an initial reaction of arrogance and disdain, banks have had to acknowledge customer and community concerns and interests. The Australian Labor Party and the Finance Sector Union have also led the way in championing the charter of community service for the banking sector—a position ignored by the coalition. After making submissions in 1996 to the Wallis inquiry, in which the banks stridently refuted any notion that they had a community service obligation, it is heartening to see that all the hard work done by the community, the union and the ALP in campaigning and lobbying has recently seen not only a reversal of that position by the banks through their group, the Australian Bankers Association, but also a positive adoption of a community service obligation.

Mr DEPUTY SPEAKER (Mr Nehl)—Order! I am loath to interrupt the honourable member for Lowe, but he is aware, of course, that the bills which we are debating cognately are the Financial Sector (Collection of Data) Bill 2001 and the Financial Sector (Collection of Data—Consequential and Transitional Provisions) Bill 2001, and there is an obligation under standing orders for members speaking to speak to the content of the bills. As yet I have not heard you say one word about the content of the bills, and I would commend you to observe the standing orders and to speak about the bills.

Mr MURPHY —Thank you, Mr Deputy Speaker. While there is some way to go to repair the damage done by the ruthlessness of bank restructuring in the 1990s, it can at least be said that the community and customers have the banks' attention. Hopefully, banks will adopt a more balanced approach in the future, with a swing back to reincluding the interests of the community and customers, together with those of the shareholders. Like banking, insurance has been regarded by Australians as one of the essential features of the landscape, but here, too, great changes have been wrought during the 1990s—changes that have seen insurance companies seem to become more the instruments of their executive officers and leading investors than of their policyholders.

Insurance companies are now huge multinationals and seem to have left their policyholders behind—except for their premiums, of course. Insurance companies have also graduated since the mid-1980s into superannuation providers and master fund managers. No longer can we speak of the old-fashioned insurance agent with the personal touch with the policyholder. These huge combined companies are now engaged in the receipt and investment of the retirement funds and dreams of millions of Australians. Yet all these great and significant changes in the finance sector over the last two decades seem to have passed the regulators by in the night. That is the only conclusion this parliament and the people of Australia are left with.

Banks and insurance companies no longer represent the Victorian era gentlemen's club with the interests of old. They are now huge investment corporations which have the retirement futures of millions of Australians in their hands. These institutions can no longer be allowed to regulate themselves. The public and national interest now demands and dictates that the public be able to exercise scrutiny and accountability of their activities and decisions.

And yet again, the regulator charged with exercising that scrutiny and demanding that accountability seems not only unwilling but unable to do so. Worse, if the conduct of APRA during the unfolding nightmare of the HIH failure is anything to go by, APRA, according to the public statements of its CEO, Mr Graeme Thompson, actually withholds its hand in such situations because to take up its charge actually risks aggravating the situation. This is an impossible attitude to hold because it means that when the regulator is needed most—that is, when it is needed to intervene with preventative and remedial measures to assist the financial corporation to remain in business and to discharge its responsibilities to its customers, policyholders and investors—the regulator, APRA, disarms itself and retreats to the bleachers to simply observe the calamity unfold to its conclusion, in collapse and disaster. A regulator with such a morbid sense of observation, rather than being proactive, cannot deserve the confidence of the community.

Mr Graeme Thompson, in comments reported in the Australian Financial Review on Friday, 3 August 2001, castigates the wiseacre experts who have criticised APRA over the HIH collapse and blames the flawed regulatory regime he inherited. Mr Thompson was part of that flawed regulatory regime for many years whilst he was at the Reserve Bank prior to his assuming the position of CEO of APRA in 1999, and never a word has been publicly reported of his concerns and doubts about this flawed regime of regulation.

APRA has a responsibility to the Australian people to ensure that the financial institutions in its charge are accountable for their conduct, both good and bad, and to see to any remedial and preventative intervention required to assist financial institutions in the ways and means by which they conduct their businesses. At the forefront of APRA's daily work should be—must be—the face of Australian people whose financial welfare is now in the hands of unelected fund managers.

The HIH collapse demonstrates clearly and presently that these fund managers need a wake-up call with regard to their responsibilities to the people of Australia and not just to the board of directors, and the instrument which should provide that wake-up call, that reality check, should be APRA. Its very passivity and its attempts to justify that passivity condemn APRA in the public mind. This legislation is intended to bring some rationality to the centralising of information and financial sector reportage. The destination at first instance for that data will now be APRA.

That there will now be a single destination for that data is a good thing. The wisdom of APRA being that single destination remains to be seen. APRA is very much a regulator whose usefulness will sorely be tested in the forthcoming inquiries. I hope for the sake of the Australian people that APRA, and particularly its uncontrite CEO, see some light on the road to Damascus of these public inquiries.

Finally, I commend the remarks of my colleague the member for Wills and support the amendment to delete section 13(5)(b) as I believe it should be no burden to establish and operate on a reportage regime which has as its first and last test the public interest of the Australian people and their financial welfare.