Canberra, Oct 4 (IANS): The Australian government has promised a "significant" cultural change in the way the country's banks treat their customers, ahead of this week's three-day parliamentary inquiry into the banking sector on Tuesday.
The government in August said it would grill the heads of the four major banks, the Commonwealth Bank, ANZ, Westpac and NAB, following their controversial decision not to pass on the Reserve Bank of Australia's (RBA) interest rate cut to customers, Xinhua news agency reported.
The government said it would be exploring ways to make the banking sector more accountable through driving competition within the industry, with Commonwealth Bank boss Ian Narev to be the first CEO to face the House of Representatives Economics Committee on Tuesday.
The committee's chair, Liberal MP David Coleman, said the inquiry would help restore consumer confidence in the banks, which have been revealed to be the most profitable in the OECD.
"This public forum of 12 hours of hearings this week is a very substantial development and I think it will lead to significant cultural change in the industry," Coleman said on Tuesday.
Despite the government inquiry, the federal opposition has maintained its pressure on the government to call a royal commission into banking, MP Matt Thistlethwaite said. The "unethical behaviour" had been exposed but a three-day questioning would not result in any meaningful change.
"Many of the scandals in the banking industry are continuing, the unethical behaviour continues," Thistlethwaite said.
"Whistleblowers have told us that what's been exposed to date is the tip of the iceberg."
Labour's Shadow Minister for Financial Services, Katy Gallagher, said the inquiry was a weak response from the government and was just a way for Prime Minister Malcolm Turnbull to protect the banks from having to face an independent royal commission.
"The bank CEOs will walk away at the end of their three-hour chat, safe in the knowledge that they won't be questioned again," she said.
"Meanwhile those who've lost their savings, their homes or their businesses and who remain in debt to the banks will be stuck living with the consequences every day."
While the government has maintained its position that the three-day inquiry will uncover the root of the issue, research undertaken by the Australia Institute found that two-thirds of Aussie voters still want a royal commission.
At least 77 per cent of Australians believe the banks should be forced to pass on the interest rate cuts, while 75 per cent believe banks should put customers ahead of shareholders.
Half of all voters think the government's inquiry is simply a way for Turnbull to protect the banks.