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New Reserve Bank Board appointee discusses her career.\n

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PETER CAVE:   The Treasurer, Peter Costello, last night appointed investment banker, Jillian Broadbent, to the board of Australia’s Reserve Bank.  In order to accept the job, she’s had to resign from her day job at Bankers Trust, which was reputed to earn her somewhere between $500,000 and $2 million a year.  At the Reserve Bank, she’ll be earning just $27,500.  A short time ago, Jillian Broadbent spoke to our economics correspondent, Peter Martin.


JILLIAN BROADBENT:   I’m extremely honoured to have been invited and I’ve got a strong sense of social responsibility in that regard, but I want a change in my career and this provided an opportunity to make that change.


PETER MARTIN:   It’s said that your salary at Bankers Trust is half a million plus.  You’re going to a job which earns an honorarium of $27,500 a year.  What is it that makes you prepared to give up what you’ve had very near the top of the Bankers Trust tree?


JILLIAN BROADBENT:   Well, I think money isn’t everything, but at Bankers Trust the nature of the job is 12 hours a day and you travel a lot.  I’m anticipating building up other activities - not just the Reserve Bank Board, which is a much shorter time involvement than Bankers Trust.  So, I’m hoping to add to the $27,000.


PETER MARTIN:   Is it a feeling that there in a way there’s more power than there is anywhere else in the financial markets in that the Reserve Bank these days sets Australian interest rates?  It doesn’t react to Australian interest rates, it sets them.


JILLIAN BROADBENT:   I don’t know about power.  I think there’s more responsibility, but I don’t know that I’ve seen it as power.


PETER MARTIN:   I suppose the big trade-off that the Reserve Bank has to do all the time is between two of the objectives laid down in its Act:  one is the maintenance of full employment in Australia and the other is stability of prices, stability of the currency.  How do you come down on weighing those two often conflicting objectives:  full employment versus controlling inflation? 


JILLIAN BROADBENT:   Well, I think it depends where you are in the cycle.  At the moment, you’d have to say the employment issue is more important than prices because we haven’t had a concern about inflation for some time, but there’s still an employment situation which isn’t satisfactory.


PETER MARTIN:   Could we take it from that, Jillian, that you have what they refer to in the trade as a bias towards easing?


JILLIAN BROADBENT:   Perhaps that’s so.


PETER MARTIN:   Do you think at the moment that there’s a case for easing interest rates because the unemployment rate is stuck more or less where it is, at around 8 per cent?


JILLIAN BROADBENT:   Oh look, I think it’s a bit the unemployment rate and it’s a little bit what’s happening globally and the economic environment in Asia that’s influencing that decision.  Whether I have a view one way or the other is probably going a bit too far.


PETER MARTIN:   But before attending your first meeting as an outsider in financial markets, your view has been certainly more in favour of considering the case for an easing than anything else.




PETER MARTIN:   Thank you very much for your time.


PETER CAVE:   Time that costs a little bit less than it used to.  That was Jillian Broadbent of Bankers Trust about to leave her job for the board of Australia’s Reserve Bank.