When banks vacate the field, let public services in!

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Lead Editorial

20 September 2023
Vol. 25 No. 38

Communities have spoken: the time has come for the postal bank solution. All ideological constraints must be set aside, and the only plan to save our towns implemented, now!

The necessity for a government-owned bank, operating through local post offices or otherwise, rose to centre-stage at the Launceston hearing of the Senate inquiry into regional banking closures on Tuesday. As the hearing hit pay dirt, it was also revealed that the Committee is committed to pursuing the banks until it gets results and will thus extend the inquiry through March 2024 in order to hold hearings in South Australia, hopefully including Coober Pedy.

This occurs against the backdrop of Macquarie Bank announcing it is transitioning to digital payments only— a.k.a. going cashless—which is already affecting people the nation over, with businesses that bank with the nation’s fifth largest bank (by assets) already alerting customers that they will no longer accept cash, cheques or money orders. And in today’s hearing (20 September), CBA CEO Matt Comyn revealed to the Senate that subsidiary BankWest— which caters to regional areas—plans to go fully digital!

Communities that have already been abandoned by countless other services, and left bereft of funding and vital infrastructure, are now losing the key element that makes everything happen—access to money, to local lending, and to cash which is central to so many community functions. In the small, locals can see that this is the same approach that is destroying our entire nation, top-down. Witness after witness, at Launceston as at all the other hearings, drew out the absurdity of cutting out physical bank branches and cutting off the flow of physical money, particularly in regional areas, locales with patchy mobile service and internet, and against a backdrop of floods, bushfires and myriad other interruptions.

Amid all of this the solution is looming large: a public postal bank.

Witnesses in Launceston and elsewhere, and Senators in Canberra today, also pointed out that the Post Office is  conducting most or all banking in many small towns already; they are being inadequately compensated for doing the banks’ job; and Post Offices are closing, or threatened with closure, everywhere. The win-win postal banking solution, which will save post offices and local towns, is clear. One witness in Launceston said she could remember working at the Post Office when every outlet was an agent for the (then government-owned) Commonwealth Bank!

Robert Mallett, CEO of the Tasmanian Small Business Council, argued a convincing case for establishment of a government-owned bank to rescue regional areas. While the banks might protest citing “competitive neutrality” clauses—competition policy which makes up for the supposedly unfair advantage governments have in the open market—Mallett said, “I would argue that given they’ve abandoned the marketplace, effectively, that leaves it open for government if they push to have a community bank, hold their own licence and provide those services in those areas”.

The Senators were very engaged on the proposal for government banking, with LNP Senator Matt Canavan asking the Small Business Council for details on how it might be accomplished, through the Post Office network or otherwise. Geoff Fader, Chairman of the Tasmanian Small Business Council and former director of the Council of Small Business Organisations Australia (COSBOA), was adamant that the Post Office was in prime position, with upgrades and training, to provide the services abandoned by the banks. This is in fact an “opportunity to expand to fill a gap which has consciously been left” by banks, he said. Postal banking “should in our opinion be considered seriously because the banks have walked away from any provision of reasonable community service.”

As of writing, Senators are grilling witnesses at the Canberra hearing, which includes the Big Four bank CEOs, the Australian Banking Association and the Banking Code Compliance Committee. This will get heated, so stay tuned!

In this issue:

• Senate inquiry probes bank closures this week in Launceston, Canberra and Junee
• Foreign interference inquiry’s dubious witness line-up
• Aus, UK national insecurity establishment moves to re-freeze relations with China
• A funny thing happened on the way to Beijing: Reflections on spy recruitment practices
• Biden: Chinese among ‘bad folks’ who do ‘bad things’
• The West appears to be preparing another regime change ‘uprising’ in Syria
• Libya catastrophe caused by 2011 NATO invasion, Qaddafi murder
• Momentum for new development order gathers pace
• China and Iran reach important ‘oil for construction’ deal
• Motion is caused by forces
• Rethinking the financial matrix: two pathways
• ALMANAC: BRICS opens a new chapter in world history!

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