September 15, 2018 / 2:31 AM / 2 months ago

Australia's new treasurer to get tough on financial regulator

MELBOURNE (Reuters) - Australia’s new federal treasurer, Josh Frydenberg, criticized the conduct of the corporate regulator and promised it powers to speed up compensation for mistreated customers.

FILE PHOTO - The new Australian Prime Minister Scott Morrison shakes hands with the new Treasurer Josh Frydenberg after the swearing-in ceremony in Canberra, Australia August 24, 2018. REUTERS/David Gray

In a round of interviews with newspapers published on Saturday, Frydenberg said he would demand answers from the Australian Securities and Investments Commission (ASIC), over mounting troubles in the financial services sector.

“I’m appalled by the behavior that has been exposed through the banking royal commission,” Frydenberg told Guardian Australian.

A Royal Commission inquiry has exposed systemic wrongdoing at some of Australia’s top institutions, airing almost daily allegations of misconduct across the consumer credit, business lending, farm finance, pension fund and insurance sectors.

Flexing its muscle amid the criticism, ASIC on Friday sued Australia and New Zealand Banking Group Ltd (ANZ.AX) over a troubled A$2.5 billion (1.4 billion pounds) share placement. [nL3N1W02KF]

Frydenberg, a former energy minister who became treasurer in last month’s major overhaul of the center-right government, told the Australian Finiancial Review Weekend the remediation changes were needed to compensate aggrieved customers.

“A new ASIC remediation power, as recommended by the ASIC capability review, and accepted in principle by the government, is one potential solution to ensure better and speedier consumer outcomes,” he added.

Frydenberg also said he would be willing to extend the Royal Commission inquiry, if needed. The Commission is due to present to government its interim report on Sept. 30th.

He also said company tax cuts for big business, a policy abandoned last month, would not be reconsidered, but the government would focus on a deregulation agenda that would streamline approvals process for big businesses.

“The big focus for me is going to be on the productivity agenda, and the productivity agenda involves cutting regulation which is really important to business,” he said.

Frydenberg told Guardian Australia the government plans a series of big spending initiatives, such as more cash for Catholic schools, healthcare and the national disability insurance scheme. He said, however, that the government still has a target of balancing the budget in 2019-2020.

Reporting by Lidia Kelly; Editing by Clarence Fernandez

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