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Tuesday, 25 November 2008
Page: 11201


Ms JULIE BISHOP (2:08 PM) —My question is to the Treasurer. I refer to the Treasurer’s statement on 23 October that those depositors in managed investment funds adversely affected by the government’s bank guarantee go to Centrelink. How many depositors affected by the bank guarantee have inquired about receiving assistance from Centrelink and, of those, how many have actually received any payments?


Mr SWAN (Treasurer) —I certainly thank the shadow Treasurer for her question. I did not say that all people in managed investment funds who were experiencing problems should go to Centrelink. What I said was that those that were experiencing hardship may, if there were a reassessment of their position by Centrelink, be eligible for some support—which, of course, was a question that had been asked in the House that week by a member down there, the member for Moncrieff. I made a very logical point that those who are impacted upon by the current state of the economy in terms of their investments may be experiencing hardships and one avenue that was open to them was, of course, to seek a re-evaluation of their situation from Centrelink. We are actually proud of Centrelink on this side of the House. It does provide a lot of support to a lot of Australians, particularly when they experience difficulty. But that point was not made as a substitute for anything else other than to say that if they had hardship, that was one possibility.

The government is attending to the issues when it comes to managed investments. Indeed, we work with the regulators, as we have been working with the regulators all of the way through, and our advisers in the Treasury to ensure that all of those people out there that are the subject of an influence from the global financial crisis in the way in which it impacts on their assets are looked after. What we have done through the Treasury and through David Murray is that we have a series of task forces in the Treasury working with the various industry associations. Whether it comes to car finance, whether it comes to mortgage trusts or whether it comes to cash management trusts, these are very serious issues. Of course, what the opposition will not admit and cannot admit—because they do not understand the magnitude of the global financial crisis—is that, when we introduced the deposit guarantee to protect 13 million depositors in this country, they should have supported it. On the day, they promised bipartisan support, and it took about 24 hours before they were junking it in public—24 hours—because they do not understand the seriousness of the situation; they simply do not get the seriousness of the global financial crisis.

We on this side of the House are proud that we acted decisively and swiftly to put in place the deposit guarantee and the wholesale term funding guarantee, because it is absolutely essential to the financial stability of this economy—and it remains so. That is why it is so regrettable that we have seen so much short-term point-scoring and politicking from those on the other side of the House, who do not understand the importance of financial stability. We do, and we are working with our regulators in terms of the deposit guarantee and the wholesale funding guarantee to ensure that it produces the maximum results for the Australian people. We will not be diverted by the political point-scoring from those on the other side, particularly the Leader of the Opposition, who does not seem to understand the importance of the deposit guarantee. His policy is to put a cap on the deposit guarantee of $100,000. I could not think of anything more destructive than that proposal because that would leave 40 per cent of deposits out of the guarantee—the most liquid deposits in the banking system. He cannot really support our measure because he does not understand the magnitude of the crisis that we are facing and the measures that are required to put stability in the system.


Ms Julie Bishop —As the four-page interview will not be found anywhere on the Treasurer’s website, I seek leave to tender the transcript of 23 October.

Leave not granted.