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Tuesday, 22 February 2011
Page: 900


Mr HOCKEY (2:16 PM) —My question is to the Treasurer. I refer the Treasurer to his statement on 12 December last year where he said that his banking package would ensure ‘that interest rates are lower over time’. And I refer to Treasury documents released yesterday under FOI which warn that the government’s plan to ban mortgage exit fees would ‘lead to a range of unintended consequences’, including ‘increasing interest rates’. Why is the Treasurer persisting with a plan that Treasury have advised will lead to higher interest rates for Australians?


Mr SWAN (Treasurer) —I absolutely welcome that question from the shadow Treasurer about the need in this country to have a more competitive banking system. It is obvious that the opposition does not think we should have a more competitive banking system. The shadow Treasurer can wave any paper he likes—whether it is a national newspaper or an FOI—but the behaviour of the banks tells us that exit fees are a huge barrier to competition. That is why we need the package of reforms that were outlined by the government at the end of last year.

Everybody on this side of the House understands how important it is to have a much more competitive banking system, how important it is to empower consumers, how important it is to boost the smaller lenders and how important it is to ensure that there is a flow of funds to the banking system through initiatives like covered bonds. But, of course, the shadow Treasurer is the only one in this House that thinks unfair exit fees are fair and that they should stay. He thinks exit fees of $7,000 are fair. That is his position. He thinks they are fair. We are committed to their abolition. As a consequence of that commitment at the end of last year, we have seen banks move to either abolish their exit fees or to bring more competition into the system.

When at the end of last year some of those banks put up their rates over and above the Reserve Bank decision, they were effectively saying, ‘We’re not afraid of the consumer; they won’t move because we’ve got them locked in with really big and unfair exit fees.’ That is the position that is supported by the opposition. They are not for customers; they are for the big banks. That is where the shadow Treasurer is.

There are only two things that are stopping consumers walking down the road and getting a better deal when it comes to their mortgages—unfair exit fees and the shadow Treasurer. We are going to get rid of the first. We are going to get rid of unfair exit fees and, of course, Mr Robb might give us a hand to do the second. What a rabble we have got over there. How can they actually ask these questions with a straight face? The finance spokesman wants the job of the shadow Treasurer, the shadow Treasurer wants the job of the Leader of the Opposition and the Leader of the Opposition wants to be leader of One Nation.


Mr HOCKEY —Mr Speaker, I have a supplementary question to the Treasurer. Will the Treasurer guarantee that interest rates will not rise with the abolition of exit fees?


Mr SWAN (Treasurer) —There is one thing that the shadow Treasurer does all of the time, in all of the hot air from the shadow Treasurer: he goes around and he misquotes and he misrepresents everything that is said.


The SPEAKER —The Treasurer will answer the question.


Mr SWAN —What we said at the end of last year was that getting rid of unfair exit fees—


Mr Hockey —Come on; show some ticker. Yes or no?


The SPEAKER —Order!


Mr Mitchell interjecting


The SPEAKER —The member for McEwen is warned! He is a bit unlucky, but he is warned.


Mr Pyne —Mr Speaker, I rise on a point of order on relevance. The Treasurer was asked a very straightforward, one-line question. If he does not know the answer he should sit down.


The SPEAKER —Order! The member for Sturt will resume his seat. He had a relevant point of order and then, like he is often prone to do, he added something which does not help. At the time the member for Sturt rose I had an expectation that the Treasurer was getting to the question. The Treasurer will directly answer the question.


Mr SWAN —I am delighted to answer the question very directly, Mr Speaker—absolutely delighted. The abolition of unfair exit fees will bring more competition to the mortgage market. What that will mean—

Opposition members—Yes or no?


The SPEAKER —Order! The Treasurer will resume his seat and we will continue when the House sits in silence. I remind members that the changes to the standing orders for this parliament did not change the nature of the way in which a question is answered. If people believe that there is only a one-word answer required, that still has not been dealt with by the changes to the standing orders. The Treasurer has the call. He will be directly relevant to the question.


Mr SWAN (Treasurer) —Greater competition will bring greater value for money and a better deal. Those opposite are happy to have these unfair exit fees, as high as $7,000, locking customers in forever. When customers get very unhappy with the behaviour of their bank, they cannot move. We are for greater competition and better value for mortgage holders. The shadow Treasurer has not got the ticker to stand up to the banks.