Mortgage Choice chief executive officer John Flavell believes that the Royal Commission into the banking sector is yet another example of point scoring by Australia’s major political parties.
When reviewing the year at a media lunch held in Sydney on 13 December, Mr Flavell claimed that the banking sector is being used as a “political pawn” by Australian politicians in an attempt to win the favour of the voting public.
“[We’ve seen] the continued use of the banking sector as a political pawn [because] it’s newsworthy, it’s populist, and if we can have a big old dig at the banks, then that’s got to be good, because it’s going to give us some sort of coverage and some sort of carriage with the community,” the CEO said.
“It’s been both sides of politics that have been prepared to take a swipe in more recent times. It’s not just been the domain of the Greens and the [Australian Labor Party].
“[Treasurer] Scott Morrison had a fair old crack at the banks when they introduced the banking levy and definitely made some political points in the way that was positioned.”
The CEO added that questions remain surrounding “who will be or won’t be in the scope” of the Royal Commission as the industry awaits clarification from the Turnbull government.
Further, Mr Flavell expressed his support for prudential measures imposed earlier this year that sought to “take some sting” out of the lending market, which he believes was “charging at breakneck speed”.
The Mortgage Choice executive predicts that regulators will ease prudential measures to avoid strangling the “goose that’s laying the golden eggs”, which contributes “14 per cent of underlying GDP growth”.
Mr Flavell said: “You never know where the pendulum settles, and typically with regulatory changes and policy changes, the pendulum swings past where there’d like it to sit, and then they make adjustments to see it come back.
“But all things remaining constant, it seems to be that the regulators have done a pretty solid job so far to achieve the outcomes they would want.”