Interview on RN Breakfast with Patricia Karvelas

Subjects: ASIC Report, Divestiture, Senator Payman

E&OE………

Patricia Karvelas

The National Corporate Regulator is failing and should be split into separate parts. That's the main finding of a damning Inquiry into ASIC the Australian Securities and Investments Commission. The troubled regulator has been under significant pressure and the widely anticipated findings of the review don't come as a big surprise. Andrew Bragg is chair of that Inquiry. He's a Liberal Senator and he joins us this morning, welcome.

Senator Bragg

G'day PK.

Patricia Karvelas

Why has ASIC failed in your view?

Senator Bragg

Well it takes too long to respond to complaints, it takes too long to finish investigations and it doesn't get very many prosecutions.

Patricia Karvelas

Okay ASIC has responded in saying they're in court every day they're very active. What's your response to their defence of their actions?

Senator Bragg

Well five years ago they were making 80 or 90 referrals to the Director of Public Prosecutions and last year they only made about 20.

Patricia Karvelas

Is it all just about volume. Isn't it also about the quality if you like if I can call it that, or you know the substance?

Senator Bragg

Well PK, there's a lot of people who've been wronged out there. There's a lot of angry people who have been done over by companies and by financial services businesses. There's a lot of whistleblowers that you know about, and I think most people believe that in Australia if you commit a white-collar crime there's a good chance you will not have the book thrown at you.

Patricia Karvelas

You're calling for ASIC to be split into two organisations, how would that work and how would that help?

Senator Bragg

Well, it's just too big I mean it's one of the biggest securities regulators in the world, it does about a hundred different things. And I think it's got a lack of focus. It’s also had massive cultural problems. Its staff surveys for example which we were able to obtain during the Inquiry showed that the satisfaction rate of staff was only 20%. In addition to that there's been massive squabbles on the commission level. So I just think it's too big and it's not focused on its core job which is law enforcement.

Patricia Karvelas

LNP Senator Paul Scarr has a different view and is in your Party Room of course and has a role on the Parliamentary Joint Committee that has oversight of ASIC. And he says from a personal perspective at this stage I'm not advocating any separation and enforcement and regulation, and he won't suggest that ASIC is not very active in the criminal law jurisdiction. Is your party at odds on this?

Senator Bragg

Look I don't think so. There are different views about how this should be concluded but certainly my sense is that this will be considered carefully by my colleagues in the Shadow Ministry and I hope other parties also will be able to take our recommendations forward.

Patricia Karvelas

In terms of the process if I can get to it without boring people let's make it let's try and jazz it up if we can, Andrew Bragg. You now have to go to your party to make this your Party's policy.

Senator Bragg

That's right.

Patricia Karvelas

And do you think there is an appetite to embrace this approach?

Senator Bragg

I think people are very open minded about this and we want to be stronger than Labor on corporate crime. Jim Chalmers was on your program the other day and scoffed at the report.

Patricia Karvelas

Let me be specific about what he scoffed at, It was I'm going to say this politely wasn't from me, it was you. He said that you were being too partisan. You were just taking control of it and critical that it wasn't bipartisan enough.

Senator Bragg

Well, I'm not into personal slights and I think Mr Chalmers may want to do that but the reality is that he has obstructed this Inquiry. He filed public interest immunity claims to stop the Senate from getting to key evidence. He worked with ASIC to undermine the Inquiry from day one. Labor voted against the Inquiry. So, I mean Labor's view is that there's no corporate crime in Australia maybe...

Patricia Karvelas

No, I don't think they're saying there's no corporate crime, they're saying that they think that that's a mischaracterisation. They're saying that they think this regulator is doing its job.

Senator Bragg

Well I think that's amazing if that's what they think and in fact the Labor Senators on the committee didn't dissent from my recommendations. So sure they filed additional comments. The Greens didn't file any additional comments so in general like this was a much less partisan process than Mr Chalmers may wish to say that it was.

Patricia Karvelas

You've said your biggest takeaway from the review was that the structure of ASIC is way too big and the culture is very sick. How is the culture so sick?

Senator Bragg

Well, those are two different things. Firstly, I actually feel sorry for ASIC because Parliament has made this problem for them. Every time Parliament has had a problem in the last 20 years in this space it's just dumped them with more things to do. So, I don't think that could be successful in a broader sense anyway. In terms of the culture as I said before I mean the staff surveys are horrendous. We get bits of paper put through my office in Sydney from disaffected staff. I mean people are really unhappy to work there, and all the squabbles on the Commission which has been in the media for the last year, I think it's been really ugly stuff.

Patricia Karvelas

Under your recommendation whistleblowers should be rewarded. How does that work?

Senator Bragg

Well I think whistleblowers take huge personal risks to try and do the right thing and I think whistleblowers are treated appallingly in this country. So if a whistleblower comes forward and that leads to fines and prosecutions I think they could be rewarded

Patricia Karvelas

What sort of rewards would whistleblower get?

Senator Bragg

They could be allocated part of the fines which is successful in the courts.

Patricia Karvelas

Alright. That's pretty radical Wouldn't that incentivise people to break ranks?

Senator Bragg

But we want people to come forward with wrongdoing. I mean this is Australia and I think we’ve let our standards go. I think there is so much crime that is not properly prosecuted and it really worries me that when people have taken risks to come forward to report appalling behaviour inside institutions, they're treated like dirt. So we've got to do a better job there and the pendulum has to swing.

Patricia Karvelas

This is a really interesting concept actually. We've seen more calls for the Attorney General to intervene in Richard Boyle's case who revealed the Tax Office was using heavy handed debt collection tactics. Is he someone who should also be protected and even rewarded?

Senator Bragg

Look I haven't looked into all the detail of his case but the whistleblowers that have come forward in our Inquiry one of them was sacked others have been ostracised. I think it's a really dangerous position for a country like Australia to be in when someone comes forward in good faith, and then damage their careers damaged they lose their mental health. I think we've got to be very careful here.

Patricia Karvelas

Just on another issue which is huge in the economic space and I believe you have views on. Senator some of your colleagues have criticised the plan to create new powers to force supermarkets to sell off stores. We spoke to ACCI before they basically said it was not a good policy. Is it a good policy?

Senator Bragg

We've never been an advocate for big business. We're an advocate for enterprise and so there are small businesses and farmers that have not been treated well by these big supermarkets And so that's why we have a competition policy.

Patricia Karvelas

Do you support this policy?

Senator Bragg

Well I'm a member of the Shadow Ministry so I support all our policies of course.

Patricia Karvelas

But you spoke out about it in the Party Room?

Senator Bragg

I didn't.

Patricia Karvelas

You didn't speak out about it?

Senator Bragg

No I don't talk in Party Room.

Patricia Karvelas

You didn't speak No I'm intrigued because you were quoted as having spoken in the Party Room?

Senator Bragg

No that must have been fake news somewhere I don't know where that was.

Patricia Karvelas

Yeah, it wasn't, it wasn't. I'm quoting I think I read it in a newspaper so you did not speak out?

Senator Bragg

No, I didn't no.

Patricia Karvelas

Okay I understand solidarity with the position but let me let me pull it back a bit and ask it more philosophically. This is pretty interventionist for the Liberal Party with uh values which are pro market right?

Senator Bragg

We are pro enterprise, but you can have a strong enterprise policy but be pro competition as well. So, if there are competition restraints in place then they should be attacked, I think it's quite reasonable.

Patricia Karvelas

Is there any evidence that this will lead to more competition?

Senator Bragg

Well there's a public interest test for people who are concerned about what might happen. I've heard lots of different hypotheticals play out and I guess in those hypotheticals the public interest test would be considered by the courts.

Patricia Karvelas

Do you think before advancing this you should explore whether it might lead to even price rises, which is one of the predictions ACCI put to me before?

Senator Bragg

Well, that's what the public interest test is designed to do, to make sure that that wouldn't happen.

Patricia Karvelas

So what happens? You think sometimes you wouldn't use this big stick?

Senator Bragg

Well, it's a court, the court makes the decision.

Patricia Karvelas

So, do you want the laws to be used?

Senator Bragg

Well, the court makes the judgement about whether the public interest test is meant or not. I think the idea of having a stronger competition policy is reasonable. In supermarkets it is quite concentrated, but it needs to be carefully deployed which is why there's a public interest test in place.

Patricia Karvelas

Just finally and it's not in your area other than you're a Senator, today there is wild speculation that Senator Fatima Payman may resign from the Labor Party. You know lots of reporting about the way that this is being handled and, and reporting also that there might be a 'Muslim Party' running candidates. Is that a good thing for Australia?

Senator Bragg

It's always fun in the red morgue, isn't it? Look I think in terms of Senator Payman, I completely understand she's got strong views on this, but I don't think the fragmentation of Australian politics and the breaking down of the big parties is actually good for our democracy. So, I worry where that goes.

Patricia Karvelas

What are you worried about?

Senator Bragg

Well I just think that we have had great success after the Second World War in being a country which has been stable. We've been able to resolve major differences inside the two-party system. I think that's led to one of the strongest and most prosperous countries on the planet. So, I worry about fragmentation.

Patricia Karvelas

Interesting point, I'm sure not everyone agrees but interesting point. Thank you for joining us.

Senator Bragg

Thanks PK.

Patricia Karvelas

And that's Senator Andrew Bragg.

[Ends]