Banks Should Be Obliged to Service All “Law-abiding Businesses”, Investigation Finds | Australia News


Banks should be forced to provide services to all “law-abiding businesses,” including export industries such as coal and live animal exports, a parliamentary inquiry found.

The inquiry, chaired by National Congressman George Christensen, also called on the Treasury to examine “activist pressure” on banks regarding lending to the resource sector and “if necessary, develop options to address this issue. “.

Labor and Greens rejected the survey’s findings, saying inconsistent climate policy, not the banks, is to blame for the job losses.

The report of the Standing Committee on Trade and Investment, tabled on Friday, is mixed: on the one hand, to demand that regulators consult more with the resource sector on the guidelines for climate change risks, while on the other hand, recognizing net zero emissions will create investment opportunities.

The report reflects the diverse views of its members, from Christensen, a fierce critic of financial institutions for their refusal to lend to resource projects, to Liberal MP Katie Allen, a net-zero emissions supporter.

Banks told the survey they need to actively manage climate risk because governments and regulators demand it, and because the investment community “was increasingly shifting its attention to a net zero emissions economy. “.

In his foreword, Christensen asserted that climate risk was “ill-defined” and amounted to “a veneer” for decisions made by “political and public relations considerations”.

“The committee was concerned to learn that profitable, law-abiding businesses in some of the country’s main export sectors – mainly coal exports but also live animal exports – were at risk of losing access to essential services. such as transactional banking, finance and insurance at an appropriate price. ,” he said.

Christensen accused the companies of “thinly veiled awakening”, bowing to “bad press” and “minority but noisy shareholder activism”.

The majority report by coalition MPs urges the government to ensure “at a minimum” that banks provide transactional banking services to law-abiding businesses, a far-reaching recommendation that could also benefit sex workers and sex sellers. guns who refused banking services.

It recommends that the government “order banks to prepare a regulatory impact study that describes the real impacts of a policy framework … such as job losses and economic impacts, and detailing industry comments … before withdrawing funding from any export project “.

The inquiry called on the government to consider laws requiring shareholders to be consulted before decisions “to withdraw financing from export-oriented projects.”

He called on the government to work with the resource industry to “create a self-funded insurance model,” which the Greens called “an oxymoron” and warned it could lead taxpayers to subscribe to such a scheme. .

In addition to the Treasury’s review of lobbying lobbyists, the inquiry asked the Australian Competition and Consumer Commission to determine whether denial of loans or insurance to the resource industry violates the competition law, which prohibits companies from acting “in concert”.

The government should then “consider options to ensure that viable, profitable and lawful businesses can access finance and insurance services at a reasonable price,” he said.

The reserve bank on Thursday called climate change a “systemic risk” to the financial sector, a fact that tends to suggest that banks are meeting the same imperative of mitigating risk rather than acting anti-competitive.

In their dissenting report, Labor MPs and Senators said the recommendations would “impose a substantial material risk on the Australian economy”, warning against rising costs for insurance, business loans and even residential mortgages. .

The Labor report said the financial sector expected lower prices and volumes of coal exports in the future and the “widely recognized” risks of climate change itself.

In another dissenting report, Greens Senator Dorinda Cox said the investigation was a “thinly covered public relations campaign for the fossil fuel industry.”

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Cox said the investigation was based on the idea that “regulators and banks fail to make a rational assessment of the threat posed by the climate emergency … [that] those whose job it is to assess the risks in the trillions are all wrong ”.

The decision to blame “activists” ignored “the fact that the global transition to net zero is already underway, whether the Morrison government likes it or not,” she said.

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