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Why banks ignore Wayne Swan

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Why should Australians even bother listening to Wayne Swan?

This week the Treasurer’s only advice to customers concerned about interest rate cuts not being passed on was to send them ‘down the road’:

“They should walk down the road and get a better deal.” (Source: Wayne Swan, Press Conference, 1 May 2012)

But down the road takes them no-where to a better deal. Under Wayne Swan competition in the banking sector has decreased, with the big banks’ share of housing loans increasing significantly from 75% in December 2006 to its current level of 86%.

Wayne Swan has warned the banks on 58 occasions to not move outside the variations of the Reserve Bank. The reaction of National Australia Bank, the Commonwealth Bank and the Bank of Queensland shows they have stopped listening to our weak Treasurer.

The Coalition is simply holding Wayne Swan to his word.

The Treasurer has treated Australian homeowners and small business with contempt. Australians deserve real competition in the banking sector. Even one of Mr Swan’s preferred ‘smaller players’ has only passed on a 35 basis point reduction. Australian customers will not get real competition from a Treasurer who does not mean what he says.

Wayne Swan stated in 2008: “…it is entirely their right as a commercial organisation to take this decision in their commercial interests…” (Source: Wayne Swan, Press Conference, 8 January 2008)

However, in 2010 the Treasurer decided it was time to change his mind, when he accused the banks of gouging customers: "I think we've seen recently that any bank trying to gouge their customers on rates can expect a severe community backlash." (Source: Wayne Swan, Quoted in ‘Swan puts heat on banks not to add to interest rate woes’, The Age, 5 October 2010)

The Government must immediately move to implement the Coalition’s nine point banking reform package in full. Australians deserve better than Wayne Swan as Treasurer.

Why Banks ignore Wayne Swan Wednesday, 2 May 2012

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