At the dramatic hearings of the Senate inquiry into bank closures in regional Australia in Queensland last week, more than half of the Senators present advocated for a public bank solution.
This is the same solution the Australian Citizens Party is fighting for: a government-owned people’s bank, like the original Commonwealth Bank, operating through post offices, to provide full banking services to every community and force the Big Four private banks to truly compete.
The hearings in Cloncurry on 17 May and Ingham on 18 May, attended by ACP Research Director Robert Barwick, demonstrated why a people’s bank is the clear solution.
Both towns have Westpac branches, which in February Westpac had announced would close; however, following the first hearing of the inquiry in Sale in Victoria on 2 March, which exposed Westpac’s lack of consultation with communities before it closed branches, Westpac management declined to attend the Cloncurry and Ingham hearings and announced it would keep the branches open instead.
This outcome is a testament to the Senators on the inquiry holding the banks to account, which is all too rare in Australian politics.
No business sense
More importantly, however, it exposes the truth behind branch closures—they are not justified!
If Westpac can so easily reverse its decision to close eight branches just to avoid being subjected to the scrutiny of a Senate hearing, it proves the closures of those eight branches were never justified, and it indicates that many, many other branch closures around Australia, by all banks, are also unjustified.
All of the community witnesses at the Cloncurry hearing emphasised that closing the Cloncurry branch made absolutely no business sense whatsoever.
Cloncurry Mayor Greg Campbell highlighted that the Cloncurry region is booming economically. It is a centre of the booming cattle industry, and so-called new economy (copper and other minerals) resources industries in Australia, and it is being developed even further with new projects like the Copper String 2.0, a 1,000km power line project.
“We know how much potential there is here, and why they would want to turn their back on us just made no business sense”, Mr Campbell said. “They’ve got literally billions tied up with half a dozen customers alone. … It seemed to make no sense at all, from a business perspective, why they would exit this area.”
One of Australia’s wealthiest cattle barons, Don McDonald, who is based in Cloncurry, supported that point: “The money that’s coming out of the beef industry and the mining industry in this area alone is enormous, and that’s got to be considered in keeping your doors open.”
Both the Cloncurry and Ingham hearings again highlighted the problem of banks not consulting with communities before they decide to close branches.
By contrast, Peter Lock, CEO of Heritage and People’s Choice bank, explained to the Cloncurry hearing that his bank has not closed any branches because branches are essential to the business: “We are a small bank in relative terms, so our branch presence is an important part of our overall attractiveness and infrastructure”, he said.
Banks following an agenda
ACP Research Director Robert Barwick observed: “This inquiry has caught the banks red-handed. It’s clear that the reason they don’t consult their local staff and communities before they close branches is that consultation would prove the closures are not justified in any normal business sense.
“This proves the big banks are pursuing a dystopian agenda, by which they are trying to move to an entirely new banking model which would enable them to extract maximum profit with the barest minimum of service, namely digital banking. Whereas the smaller banks see branches as complementary to digital banking, the Big Four want exclusively digital banking, so they can harvest all our data and get a cut of all our transactions. But the backlash they are getting through this inquiry shows that communities, from whom the banks extract their profits, want ongoing face-to-face banking services.”
People’s bank solution
In Ingham, the majority of Senators had heard enough to back the public bank solution. Greens Senator Penny Allman-Payne said: “We had a publicly owned bank, the Commonwealth Bank, and we saw that dismantled when the Hawke Labor government turned towards neoliberalism. It’s not good enough and we need regional communities to have better.”
LNP Senator Gerard Rennick said: “The banks, they’re driven by the profit margin, that’s fine—but we really need to look at having a public bank. We have public hospitals, private hospitals. We have public schools and private schools. Why can’t we have one public bank that acts as a backstop for both banking services and insurance services in the regions and across all of Australia?”
One Nation Senator Malcolm Roberts said: “We need a people’s bank, a public bank—that’s emerging well and truly.”
Inquiry Chairman Senator Matt Canavan described this inquiry as the most successful one he’s ever participated in. He announced at Ingham the inquiry intends to visit every state.
Click here to sign the Citizens Party’s petition for a post office people’s bank.