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Monday, 10 April 2000
Page: 15555

Mr BARTLETT (2:31 PM) —My question is addressed to the Treasurer. Treasurer, you would have seen recent reports about loans by the Reserve Bank of Australia to its staff. Can you detail for the House the background and history of such loans?

Mr COSTELLO (Treasurer) —I thank the honourable member for Macquarie for his question. I did notice in some of the newspapers today some attention being paid to loans to the Deputy Governor of the Reserve Bank. It is well worth reminding the House, I believe, that there has been provision in the Reserve Bank Act since 1959, when the bank was established, for the bank to provide housing loans to its staff. That provision would have been there beyond 1959, except the bank was only set up in 1959. That provision had been in the Commonwealth Bank Act, which had been the predecessor to the Reserve Bank Act prior to 1959. The practice of the bank making housing loans to its staff existed throughout all Labor governments: the Whitlam government, the Hawke Labor and the Keating Labor government. Fringe benefits tax is payable by the bank on these loans. The bank is not empowered to lend to non-executive members but can lend to executive members of the bank board, and that is disclosed in the annual report.

I noticed that the Leader of the Opposition was out trying to play a bit of politics on this issue this morning, trying to work the issue up, as if he had ever been opposed to such a practice under the many Labor governments in which he actually served. For example, in 1995 when the current Leader of the Opposition was then the Minister for Finance and Bernie Fraser was the Governor of the Reserve Bank, the RBA annual report indicated there were two housing loans then outstanding, aggregating $408,714, as opposed to the most recent report, which indicated that there was a loan outstanding in the order of $77,007. There was not one word of criticism from any member of the Labor Party during the period that they were in office of that practice. It is a practice which had been continued from the inception of the Reserve Bank. While the Leader of the Opposition was Minister for Finance he apparently had no objection to the practice whatsoever—his comments today were more evidence of hypocritical opportunism, trying to get engaged in a particular issue over which he had no objection at all times when he had relevant influence.