Mr IEMMA (Hurstville) [3.39 p.m.]: I move:

That this House:

(1) condemns the proposed closure of Commonwealth Bank branches in New South Wales and, generally, closures by banking institutions in the State;

(2) notes the hardship this will bring to local residents, particularly older people, at a time when banks are listing record bank profits and fees;

(3) notes the trend of bank closures in New South Wales, averaging one each week, and the impact these closures are having on small communities including those in the Hunter, Illawarra, central west, riverina, north coast and Sydney suburbs;

(4) supports the steps taken by the Government to assist consumers through initiatives such as the establishment of new credit union branches; and

(5) calls on the Federal Government to immediately finalise its year-long branch closure inquiry to guarantee banks are required to meet the appropriate service needs of their customers.

I seek the support of this House to send a clear message to banking institutions in this State that their customers have had a gutful of their penny-pinching bank closures, especially when penny pinching is the last thing banks need to do. I seek the support of this House in condemning the Howard-Fischer Government for its continued inaction in the face of 10 bank closures nationwide each week, almost half of which are in New South Wales. These closures, affecting thousands of people across New South Wales, are nothing more than an exercise in unadulterated greed and cost cutting, when bank profits are at record levels. The House must recognise that those who reap the rewards from the community have a moral obligation to put something back into the same community. Those who profit should not also plunder.

Today this House must take the unprecedented step of condemning the banking sector in an effort to place pressure on banking institutions to reverse their closure plans. This Government supports the rights of consumers, including local councils, to take their business elsewhere if they believe that a bank is not serving their needs or the needs of the local community. Given the current high level of consumer complaint, I urge the Commonwealth Bank to reconsider its decision to close branches in Carlton, Penshurst and Lalor Park - decisions which were announced in the last few days. The Government is particularly concerned for older consumers in these areas who will have difficulty going elsewhere to access their bank accounts.

Bank closures right across the State are taking a heavy toll on vulnerable and small communities across the State and are adversely impacting on older people, the infirm, the disadvantaged, those with small children and those who have difficulty obtaining access to transport. These closures are particularly heartless, given the record profits being recorded by banks, with the Commonwealth Bank listing a profit of $1.09 billion last financial year and the imposition of numerous new fees on customers. The Government has no difficulty recognising good management practices that lead to profitability. However, good management practices strike a balance that leads to an obligation to the community and that obligation in turn ensures that profits are balanced with community service.

Community service reaps greater profits. The banks have tested the goodwill of the people of this State and, quite frankly, the people have had enough of being used and abused by the banking sector. It is not difficult for a bank to establish a good community relationship. However, when that relationship is broken by greed and poor decisions it is difficult to rebuild. Banks will find that, as a result of continuous closures, customers will not be willing to deal with them on a broader level in the future. In recent times the New South Wales Government moved, via its credit care program, to assist rural and regional communities supplement the closure of local bank branches with the establishment of credit unions, but the Federal Government sat on the sidelines and did nothing.

The Federal Government has been continuing its inquiry into the rural banking sector - an inquiry which has lasted more than a year. In that time the State Government has conducted rural banking forums in rural and regional areas to assist local communities address their concerns. The State Government has assisted regional communities by seeking their views for submission to the Federal inquiry. The Federal Government has not acted. The Commonwealth Bank - the bank that recently performed poorly in a survey on queuing times in bank branches - is about to close branches in southern and western Sydney. Given its broad customer base and its continued closure of branches, it is no wonder that its customers are having to wait the longest.

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Over the past year banks have not only cut the number of branches; they have continued to cut the number of agencies, thus further reducing the opportunity for face-to-face financial service to customers. There are now 1,899 bank branches in New South Wales and that number will soon be substantially reduced if the banks continue down their current path. That figure is down from the 2,080 branches that existed in New South Wales at the beginning of last year. The Commonwealth Bank closed 116 branches nationwide over the past financial year, while the ANZ closed 175 branches. It seems that the Commonwealth Bank is trying to catch up with the appalling record of the ANZ and it may well exceed the figure achieved by the ANZ by the end of the year.

The Australian Consumers Association was quoted in the Daily Telegraph on 15 September this year as asking just how the banks could justify closures as cost cutting after racking up billion dollar profits. Well might that question be asked! I do not expect hard-headed business people to take a cut in profits per se, but I expect them to make sound, long-term business decisions that take into account the views of their customers. That did not happen at Penshurst. Over the past few years the Commonwealth Bank at Penshurst has been sending most of its business and customers to Hurstville, the justification being that it has to close Penshurst because it does not have a customer base or a business base. If the Commonwealth Bank had bothered to try to shore up the Penshurst branch rather than try to shaft it, it would not have had to make that decision.

A long-term view would indicate that smart business practices take into account the level of dissatisfaction with the banking sector. Just as the community has turned away in recent years from the banks towards private mortgage lenders, those same consumers could turn away from banks for other traditional services. Banks are focal points in many communities. The local branch and the manager have represented the bedrock of regional and rural communities and in many suburbs in larger centres. The community has relied on the branches for a variety of services, but it seems that the Federal Government is prepared to let that level of community interaction wither on the vine. The profits speak for themselves. Banks do not have to increase fees and charges to realise cost recovery. Bank branches are suffering at the hands of bean counters who cannot justify their claims. How can the Federal Government sit on its hands and watch people in the community working their guts out to make a living being betrayed by their local banks who are claiming that they are not in a position to support the branches?

Yesterday the residents of the Sydney suburb of Lalor Park showed the Commonwealth Bank their fury. They appeared in large numbers outside that branch to voice their anger at the planned closure of that branch. The protesters were the sorts of people that one would not normally find in a protest group - generally older residents; men and women who felt compelled to take a stand and make themselves heard by the members of this Government. This House now sends their message to the bank and to Canberra. Today I read with interest an article in the Daily Telegraph concerning a resident in Lalor Park who now has to take a weekly taxi ride to Seven Hills to gain access to face-to-face banking. Not all consumers have the capacity to queue for minutes at an automatic teller machine, nor do they have the visual capacity to read the instructions on those ATMs, let alone the ability to make a full transaction using such a machine.

It is absurd for the Commonwealth Bank to state that it will leave an ATM at Lalor Park. We have only to look at the article in the Daily Telegraph, which refers to the statements of that disabled former Commonwealth bank customer, to establish that he could not reach the ATM as he was in a wheelchair. What a telling response to the statement made by the bank that it will leave ATMs in those areas where branches have been closed! It seems that the banks have been taking their customers for granted. The residents of Lalor Park, Penshurst, Carlton and many other suburbs across the State have become victims.

It is the responsibility of this House to emphasise that the duty of the banks and their primary regulators, the Federal Government, is to serve the community and not just reap the billions of dollars of profits that they make each year from people living in the suburbs and regional communities. This House must condemn the actions taken by the banks, in particular the Commonwealth Bank, as utterly unconscionable and send the strongest possible message to the banks that local communities will not stand for this any longer. In 1997-98 New South Wales lost the most bank branches in the nation. One hundred and ninety bank branches were closed. Given the impact on all electorates and all communities, that is something we cannot allow to continue. This motion will send the strongest possible message to the banks.

Ms FICARRA (Georges River) [3.48 p.m]: There is bipartisan support for this motion of condemnation. I have lived in Penshurst for more than 30 years and I have banked with the Penshurst branch of the Commonwealth Bank. I have now had my account automatically transferred to Mortdale, as
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have all account holders at Penshurst. Last Monday night I supported the mayors at Hurstville, Kogarah and Rockdale to organise a protest rally at Penshurst Returned Services Leagues Club. The room was crowded. It was filled with 450 residents, mainly senior citizens, who had used the banking facilities at Penshurst. The three St George councils have been leading the charge. I congratulate Councillor Mick Frawley from Hurstville, Councillor Graeme Stass from Kogarah and Councillor Kent Johns from Rockdale. Not only the Penshurst and Carlton branches of the Commonwealth Bank have been closed; according to the annual stocktake of the Reserve Bank of Australia, which was released last week, more than 500 bank branches have closed in the past year.

New South Wales has borne the brunt of the shift from traditional banking. On average in 1997-98 banks have closed 10 branches a week, more than in any other previous year. Banks have closed one in five branches in the past five years and numbers have plunged from more than 7,000 branches in 1993. Two-thirds of the closures took place in metropolitan areas, with 309 branches shut down as well as the 197 rural branch closures. Banks also cut the number of agencies for the first time in years, further reducing face-to-face financial services for customers.

As the honourable member for Hurstville said, it is not only disabled people who cannot reach automatic teller machines. Many senior citizens have never used ATMs, EFTPOS or internet banking. Incredibly, a senior manager of the Commonwealth Bank told me that the bank would assist in Penshurst by training senior citizens in the use of internet banking, EFTPOS and ATMs. That is an example of the lack of sensitivity amongst banking managers. They do not understand. In the St George area there is a high non-English speaking background population who do not know how to use such facilities, and often rely on their children to assist them.

There is also an issue of security for businesses. Many small business operators who now cannot bank at a local branch do not have an assistant to mind their premises while they do their banking elsewhere. The issue of security also arises if business operators transport large amounts of money to bank at a branch in another suburb. The Commonwealth Bank has said that customers from Penshurst can bank at Mortdale or Hurstville and customers from Carlton can bank at Kogarah. My electorate office is in Hurstville and I know how difficult it is to find a parking space in Hurstville or Kogarah. My electorate is lobbying for more parking spaces and a commuter car park to free up the council car park areas. It is difficult to find parking spaces at Hurstville, which is a very busy shopping centre. The State Government needs to build more car parking facilities at Kogarah, a busy commercial centre close to St George hospital. A person can drive around for half an hour trying to find a car parking spot in Kogarah.

Senior executive officers of the Commonwealth Bank and other banking organisations have not had to do what they are recommending senior citizens do. In one case a senior citizen had to travel to Hurstville and stand in a long queue. After three-quarters of an hour in the queue the senior citizen was feeling faint and was given a chair to sit on while waiting. It is a crazy situation. The bank branches at Westfield shopping centre, Hurstville, and Forest Road, Kogarah, are already busy. The banking organisations have no sensitivity. I echo the sentiments expressed in the Daily Telegraph editorial of 15 October, which stated:

. . . there is a balance between accountability to shareholders and the responsibility of providing a service to customers in both metropolitan and regional areas. This justification in the face of near-record profits by the major banks is difficult to accept.

The Commonwealth Bank profit last financial year was $1.09 billion and this year the Commonwealth, ANZ, Westpac and NAB expect profits of between $5 billion and $6 billion.

The closures have ruptured rural communities and touched off protests.

In the past two days more than 500 people have protested against the closure of suburban Commonwealth branches at Penshurst, Carlton and Lalor Park. Blacktown, Hurstville, Kogarah and Rockdale Councils and the Local Government Association have threatened to boycott the bank.

The editorial continued:

The voices of protest deserve to be heard. Otherwise accusations of blind avarice levelled by angry customers will find their mark.

Those accusations certainly will find their mark. The Local Government Association, LGA, in opposition to the Minister for Local Government - who referred to me in an unkind manner during an answer he gave in question time - is supportive, and I support what the LGA is attempting to do. An article in the Leader of 15 October, which quotes Councillor Peter Woods, stated:

The Local Government Association of NSW is threatening unprecedented action against the major banks with an ambitious plan to establish its own bank using the infrastructure and revenue of councils across NSW.

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In the St George area Councillor Mick Frawley is taking the lead by writing to all councils around Australia in support of the LGA. As immediate past president of the Australian Local Government Women’s Association, I have written to the national President, Councillor Lorraine Wearne and the New South Wales President, Councillor May Hudson. I have urged them to join in the LGA proposal to get all councils around Australia to tender out their banking business, as Hurstville City Council will be doing shortly, or to join with Councillor Peter Woods and the LGA movement in pooling their resources. The councils throughout Australia hold resources in excess of $4 billion. With a high percentage of councils currently banking with the Commonwealth Bank, the National Australia Bank and Westpac, the major banks stand to lose hundreds of millions of dollars. The article continued:

The president of the Local Government Association of NSW, councillor Peter Woods will call on the organisation’s 84-member councils to consider the plan in his presidential speech at the association’s annual conference in Coffs Harbour.

The article stated that in response to a motion supported by hundreds of people at a public rally at Penshurst RSL club on Monday night Councillor Woods said:

A formal working party would be formed to oversee the establishment of financial services operated by councils and encourage credit unions to join the venture to strengthen the offensive against the major banks.

Local government and local communities are leading the charge in giving banks the flick. The movement is possible because local government councils have the financial reserves. People are sick of banking organisations increasing charges and closing services. They are sick of being treated with contempt. I am sure that they would like to see local government councils, with the co-operation of the credit union associations, take these banks head on. I compliment Senator Marise Payne, who, before entering Parliament, was the public affairs manager of the association that oversees credit unions. Being a country lass from the Southern Highlands she realised that credit unions should take up the business that banks are removing from local communities.

I support the efforts of Councillor Peter Woods and the mayors in the St George region. All of the major banks are to be condemned for their insensitive attitude to our communities. They are hurting senior citizens. All honourable members would remember the Commonwealth Bank Martin Place money boxes and passbooks that we had in primary school. Senior citizens have contributed to making the Commonwealth Bank and other banks great financial institutions. Those senior citizens are now being tossed aside and told to cope as best they can. It is not good enough.

Mr AQUILINA (Riverstone - Minister for Education and Training, and Minister Assisting the Premier on Youth Affairs) [3.58 p.m.]: With my colleagues on the Government and Opposition benches, I express outrage on behalf of my constituents at the action by banks in closing their branches. We have already heard substantial comments from honourable members about the heartless actions of the Commonwealth Bank in closing its Lalor Park branch. Lalor Park is basically a Department of Housing area that caters for elderly residents. These residents have contributed a lifetime of hard work to their community. They would like to be able to go to their local shopping centre and carry out all their shopping needs and banking transactions. For most of them their banking transactions amount to a fortnightly cashing in of their pension cheque. They like to shop and bank locally to support their local community. They would like to think that their local community also supports them.

The Commonwealth Bank has told them that it does not want their business any more and that the pensioners of Lalor Park can go elsewhere. It is just not good enough for the bank to tell the people of Lalor Park that this is the way they are going to treat the elderly. It is not good enough for the New South Wales regional manager to write back in flowery terms and basically say that profits come before people, the bank is sorry, but the number of transactions at the Lalor Park branch of the Commonwealth Bank have fallen below their magic line and it has to close the bank.

I wrote to Mr Dick Perkins, General Manager, New South Wales on 22 September. I pointed out to him in no uncertain terms that Lalor Park has a large number of elderly residents or pensioners who reside in Department of Housing accommodation and that many of those elderly people will be forced to travel to Blacktown for their banking transactions. As is stated in today’s Daily Telegraph, many of those people will need to travel by taxi. How much will that take out of their fortnightly pension cheques? It is not good enough to tell them to use an ATM.

Many elderly residents have difficulties with their sight, and many have difficulties using computers and ATMs. There is nobody to help them or show them. The honourable member for Hurstville mentioned Rodney Rammers, who is a
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good friend of mine. Because he is in a wheelchair, ATMs are too high for him to use; they are not accessible for the disabled. The bank is treating vulnerable people with total disregard. Last year the Commonwealth Bank made a profit of $1.09 billion, and this year it is expected to make a profit of $5 billion. Yet it will not keep open a branch which caters to residents and local businesses - even after the council spent about $300,000 to beautify the shopping centre for local residents. That is sheer nonsense.

I had just finished reeling from that news when I received advice last week that the National Australia Bank is to close its branch at Riverstone. We have gone from the ridiculous to the sublime! Riverstone is earmarked by the Minister for Urban Affairs and Planning for a major release of rural land. About 5,000 homes will be built in the Riverstone area in the very near future, but the National Australia Bank wants to close its branch. What absolute nonsense! When I meet with the manager of the Riverstone branch of the National Australia Bank tomorrow I will tell him to his face what I had no hesitation telling the Blacktown Advocate this week. This is sheer lunacy.

That is not good business practice. In 10 years the banks will want to open a branch in Riverstone, but in the meantime they will have driven out many of the shopkeepers, they will have sent a number of people broke and they will have driven out many members of the community who want to shop in Riverstone. I strongly support the motion. It is sheer hypocrisy on the part of the National Australia Bank, the Commonwealth Bank or any other bank to close down their branches. It is about time they remembered that they are not in business only to make a profit; they are there to provide a service to people. They would not exist today if not for the patronage of these people in the first place.

Mr GLACHAN (Albury) [4.03 p.m.]: Once upon a time banks in this country used to provide service and loyalty to their customers, and their customers repaid that service and loyalty in kind. When people like me left school they became customers of the bank their father had used, and it was generally expected that they would stay with that bank for the rest of their lives. That is no longer the case, because young people today shop around for the best advantage. They realise that loyalty no longer means much to the banks, so we cannot expect it to mean much to the customers.

At one time in my electorate there were two branches of each of the major banks in the main street, with the exception of the State Bank. Because of takeovers over the years, there is only one branch of each of the main banks in the main street of Albury. Banks have closed in outlying towns like Culcairn, Walla Walla, Henty and Holbrook. Banks that have been in those districts for generations, and have made good profits from their loyal customers in those districts have repaid that loyalty by closing their branches.

We could not blame the people of those small isolated country areas if they were to get together and encourage credit unions and building societies to set up business in their towns. Walla Walla is a small town, with only about 200 residents. Its last bank closed some time ago and they have been left without any banking facilities at all. It is quite some distance from the nearest banks in Albury, so residents have been left in a desperate position. The members of the community got together and encouraged the credit union to open a branch in Walla Walla, and as far as I am aware the credit union is doing good business, and its business will continue to grow. The banks cannot complain if credit unions and building societies take over more and more of their business.

Banks claim that their shareholders are demanding more profits. I know quite a few people who hold shares in banks, and I have not heard one of them ask for more profit. In fact, what they want from the banks is not only a reasonable return on their investment, but service for them and for other customers. Banks seem to have forgotten that good business is built on service; it is not simply ripping out as much profit as you can while you can. That does not pay in the long term. I am concerned about the banks’ cry that their shareholders are demanding more profits. I think the profits are going to the senior executives of the banks, whose salaries are totally out of proportion.

Banks bring in chief executives and managers from other countries who remain for short periods; they do not become Australians in a permanent sense. I object to the fact that when they return to their own countries they take with them huge amounts of money which they have made at the expense of the customers and shareholders of the banks for which they worked. Henty, in my electorate, is a good solid country town. Following the closure of banks in that town some leading citizens got together and encouraged Bendigo Bank Ltd to establish a community bank in Henty. The people of the town have contributed money towards it, and have secured premises and appointed a manager. The Bendigo Bank will provide the management expertise for this community bank, which will benefit the people of the district of Henty.

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I attended a public meeting with 300 people who pledged their support to the Bendigo Bank to establish the bank in partnership in Henty. I believe that partnership will work well, and I would advise other communities to look around and seek partners to establish banks that they will own and that will serve them and their communities for many years to come. I support the motion. The banks have lost their way. They are setting up problems for themselves in the future. They cannot expect their customers to be loyal to them if they are not loyal to their customers.

Mr WOODS (Clarence - Minister for Regional Development, and Minister for Rural Affairs) [4.08 p.m.]: There are some certainties in this debate. The first is that banks are closing and have been closing for a few years now; this is not new. The reason they give for closing is quite explicit: "The only thing we have to do is provide profit for our shareholders." They have been making that straightforward statement for some time. That statement implies that they do not have any responsibility to the public interest, the national interest or their customers. As they say, they only have a responsibility to make a profit for their shareholders. How do we fix this problem, which is harming many people in country and suburban areas? It is not in the national interest.

Governments have a greater responsibility than simply to make business decisions such as the banks are making. The banks have made it clear that they will not change their decision. The power to change the way in which the banks are acting lies in the hands of the Federal Government. It grants licences and it has the power to put conditions on the licences. The Federal Government claims that with the sell-off of Telstra it will have power to impose regulations to account for community interest. If the banks will not serve the national interest, the public interest of their consumers in rural and regional areas, the Federal Government has the power to act.

The Opposition supports the motion, part of which calls on the Federal Government to finalise its year-long bank branch closure inquiry and to require banks to meet the appropriate service needs of their customers. If the Federal Government does not take action to ensure that banks keep their branches open to service country and suburban people, it will be interesting to see whether members opposite support a motion condemning the Federal Government for not taking action in the same way that they now support this motion asking for action from the Federal Government.

The continuing closure of banks in regional New South Wales during a period of record profits indicates how out of touch the banks continue to be with community attitudes and the consumer needs of New South Wales. I recall talking about three years ago to a bank that was closing branches in my electorate. In the same year it had made $1.2 billion profit, was buying a bank in the United States for $1 billion, and was paying 100 or 200 people $1 million a year in wages. That is not in the national interest, the public interest, or the interest of Australians. The central point is that the banks are making business decisions that are not in the interests of the people of this nation and the people of New South Wales. The Federal Government has the power to fix the situation and should fix it. However, the Federal Government continues to sit on its hands in relation to this issue while the access of regional, rural and urban consumers to banks dwindles to frighteningly low levels.

The constituents of the National Party have been reminding National Party members loudly and clearly that Telstra has a responsibility to provide rural services. We will see whether their colleagues in Canberra listen over the next three years. Similarly, banks have a responsibility to provide important services, and the means to do so, given the recent $200 million windfall when the Federal Government abolished non-callable deposits in accordance with recommendations of the Wallis report. It will be interesting to see where the Opposition stands on this issue in the end. Opposition members are the champions of economic rationalism. They promote deregulation of the rice industry and the dairy industry. They support their Federal colleagues on the breaking down of Medicare. Banks across New South Wales are closing, creating hardship, and the Federal Government has the power to stop this process. [Time expired.]

Mr MERTON (Baulkham Hills) [4.13 p.m.]: About three minutes ago I found myself in a unique situation: I agreed with the Minister for Regional Development, and Minister for Rural Affairs. For once he made a lot of sense. He referred to banks departing from most areas of regional New South Wales, rationalising branches and leaving many communities without banking facilities. Customers are told that they can use automatic teller machines. They key in a number and hope and pray that they will get a response. Many people, like me, do not understand how those machines work.

A machine will never be a substitute to a person who is seeking financial advice or the
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assistance of a bank manager in relation to all the functions banks have provided for the people of Australia. Some years ago the bank manager in a country town was in a position of responsibility and was widely respected as a community leader. There has been a dramatic change. I make it clear that this is not a reflection on the calibre of the individuals who work for banks. Unfortunately, they are being put behind the shield of head office, where all the decisions are made. People in the local areas are then asked to implement the decisions.

Not only have bank branches disappeared; the power of bank managers has been greatly eroded, to the extent that they are just faces giving details of bank policies. Bank staff know that they are only sales managers for head office policy. In the search for the almighty dollar banks have rationalised their activities. Many ordinary Australian families do not have a bank. Australians are full of ingenuity. They have worked out a solution by giving banks the flick. That is why so many people are joining the secondary mortgage market and going to Aussie Home Loans, RAMS Home Loans Pty Ltd and Wizard Mortgage Corporation Ltd. Every week more people are turning to alternative banking facilities.

The Minister for Regional Development, and Minister for Rural Affairs lost me when he blamed the coalition for the problems. History shows that that is completely untrue. The Labor Party reflects a jaundiced or sanitised view of history. But a fact that will never go away is that it was the Keating Government that sold the Commonwealth Bank. It was done under a Labor Prime Minister. I know that Labor members do not like to hear that. Ever since that time there has been rationalisation. The coalition was accused of doing many things but we reacted because we were following the crowd. Labor was leading the charge and running the show in that respect.

Opposition members agree that Australians are worse off since the banks started closing branches throughout New South Wales. The closures average one a week but the impact of the closures on small communities is calamitous. I know the impact on the community in a country town when the local sheriff’s office is closed down. When a bank is closed people wonder what will go next. They lose the manager and all the infrastructure. The banks should realise that their banking licence carries a responsibility to provide a basic service for people in the suburbs and in country towns. I am afraid that the rationalisation that has taken place in country towns will continue into the suburbs. Banks will be very hard to find. That is not good enough. The licence carries responsibilities, and banks should provide decent facilities for all Australians.

Mr GAUDRY (Newcastle) [4.18 p.m.]: I am sorry that the honourable member for Baulkham Hills did not have more time to speak. He was building up to completely support the motion moved by the honourable member for Hurstville. He was condemning the proposed closures, noting the hardship, and noting the weekly trend of bank closures across New South Wales, in particular the impact in regional and rural New South Wales and suburban New South Wales. He almost congratulated the Carr Government on the decisions it has taken. I note that he did not call upon the Federal Government to finalise the banking inquiry and get the banks to have not only a profit motive but also a people motive - a social compact to protect and develop rural and regional communities and provide the service that they deserve. They should be interested only in making a profit.

An article in the Australian Financial Review of 27 August clearly outlined the direction of the Commonwealth Bank. The article pointed out that the forecasts were conservative and on the basis of a six-month profit of $602 million the Commonwealth Bank would far exceed the $1.2 billion projected for 1997-98. The Minister for Education and Training pointed to projections for a profit of as much as $5 billion profit. The article showed that the Commonwealth Bank will make that profit because it plans to slash 2,000 members from its work force over the next two years. Banks, particularly those in rural and regional New South Wales, are examined regularly and if they are not profit leaders they will be closed down and the services moved elsewhere. Rural communities are told that electronic banking is available, which is all very well for those who are computer literate. However, that does not help the elderly, those without access to transport or those who prefer the personal services they have enjoyed in the past.

In the past three years 25 bank branches in the Hunter have closed. These include the National Australia Bank in Aberdeen, Westpac, the ANZ and the Commonwealth Bank in Beresfield, the Commonwealth Bank in Dangar, Westpac in Denman, the National Australia Bank in Gresford, Westpac in Jesmond, Westpac in Long Jetty, the Advance and St George banks in Mayfield the Commonwealth Bank in Merriwa, the Commonwealth Bank in Mount Hutton, the Advance Bank in Muswellbrook, the Commonwealth and ANZ banks in Newcastle, Westpac in Rutherford, the Commonwealth Bank in Stockton, the ANZ in Stroud, St George in The Junction, St George in
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Wallsend, the Commonwealth in Waratah, Westpac in West End, and the ANZ at Wingham.

Those closures have all been driven by the profit motive. The banks could not care less whether branches are breaking even; the branches will not continue to service customers in those areas. At one stage in Hunter Street there were Commonwealth Bank branches at Dangar and Perkins streets in Newcastle West and the main branch at the top of town. Now there is only one left. The Commonwealth Bank says that customers can go to The Junction or to the top of town. Banks used to take pride in customer services but now their first priority is profit. The Federal Government must conclude its inquiry and take into consideration the views expressed by the New South Wales Government in its submission. It must work with the banks and establish licence protocols to ensure the provision of rural services.

The New South Wales Government has said that bank community education programs are a necessity, particularly for the elderly, to educate the public on electronic banking and new services. Federal funding should be increased to establish credit union branches. Many people are voting with their feet and are moving away from banks to other institutions. Who can blame them when banks believe that profit is more important than people? The Commonwealth Bank used to be called the people’s bank. It certainly is not that now. It is profit-driven and could not care less about providing services to people in isolated communities.

Mr SMALL (Murray) [4.23 p.m.]: History will show that what has happened to banks in recent years is sad. The first bank in Australia was the Bank of New South Wales, which is now called Westpac. Members of my family have been clients of that bank for many years. My grandfather was the manager of the Bank of New South Wales and retired at Goulburn. My father started at Grafton and ended up back at Grafton after having spent his life working in the bank. My brother John did exactly the same thing. My sister spent three years in the bank and I spent 12 months in the bank as a learning experience. My daughter Robyn also spent several years working in the bank.

Unfortunately, because banking can now be done electronically, many branches have closed. The Bank of New South Wales originally identified the need for a lending institution to assist the farming community, business people and wage-earners. Other banks followed suit. I am concerned about the many banks that have closed in the Murray electorate. The Wakool shire has its offices in Moulamein. Some 10 to 15 years ago it was under pressure to move to the larger town of Barham. However, the councillors wanted to retain the offices in Moulamein. The Murray shire wanted to retain the services in the small town of Mathoura but the branches closed and both those towns are now without a bank. The shires tried to do the right thing but to no avail.

Urana, Wentworth and Dareton also do not have banks; even branches in Jerilderie, Berrigan and Moama have closed. Today there are very few bank managers and many transactions of lending institutions are now directed to head office in Sydney. Managers used to be able to approve loans but are no longer able to do so. That is having a detrimental effect on rural communities throughout New South Wales. However, automatic telling machines are excellent facilities for members of Parliament, who travel around and who are able to make deposits or withdrawals. They are a real asset.

For 13 years I lived in the residence of the Bank of New South Wales at Deniliquin. Only about 18 months ago I needed a new chequebook and asked the young female teller for one. She asked me to identify myself, which was a shock because I am the local member and had lived in Deniliquin all those years. I was required to produce my licence. I asked her whether she had lived in the town very long. She indicated that she had lived there only a few months so I did not feel so bad. Banks no longer provide the personal service that is enjoyed so much by the elderly, who prefer dealing personally with managers or bank staff. Credit unions have become more prominent. Previously shires could not bank with credit unions but, fortunately, legislation has been put in place to ensure that they can now do so. I support the motion.

Ms MEAGHER (Cabramatta) [4.28 p.m.]: I support the motion. I am thrilled to have the opportunity, on behalf of the vast majority of my constituents, to bag the banks. People often complain to me about the rough treatment they receive in banks and the excessive fees and charges they are subjected to. During this debate members have said that banks are putting profit first and people last. I will go one step further and say that banks are putting profit first and treating people like cattle. Three years ago a branch of the Commonwealth Bank in my area closed, and another branch closed recently on 25 September. When I go into the main branch of the Commonwealth Bank in my area, I can wait for as long as 40 or 50 minutes for a teller, and I understand that is a common occurrence throughout western Sydney. It is an absolute disgrace and is causing a great deal of
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angst in the local community. This week the local newspaper in my electorate, the Fairfield City Champion, published a timely letter from Mr Rod McLeod. I should like to share that letter with the House. It is under the heading "Banking on our patience", and it reads:

I am writing to make people aware that the Fairfield branch of the Commonwealth Bank is suffering serious delay problems with its customer service.

My wife visited the bank last Tuesday and had to wait 40 minutes in the queue before she was served.

It was a particularly long queue and perhaps the bank had also failed to get casual tellers in.

Considering the wait, people were amazingly patient, although some were starting to get a bit toey about it.

Why do this to the customers and close the Fairfield West branch? The situation has got a lot worse since that branch closed on September 25th.

I wrote a note to the bank saying "shame on you".

I left my name and address but it hasn’t got back to me.

The bank should have a close look at its customer service. It seems it has insufficient tellers on busy days.

The editor’s note reads:

We approached the Commonwealth Bank for a reply, but received no response at the time of going to press.

I can offer a response to Mr McLeod. I asked the manager of the Commonwealth Bank to explain why there were so few tellers on a day when the queue was going out the door and down the street. The manager told me that staffing decisions are not made at a local level but at head office level, that there was some whiz-bang formula to the whole thing, and there was nothing he could do. I consider that to be totally unsatisfactory. But the customers of the Commonwealth Bank have little choice. If they close their accounts with the bank and try to go to one of the other big four banks, they will receive similar service. There is very little choice in banking for the average punter. People are being charged excessive fees to use their accounts and are being given very little return on their investments. Basically they are being handled in a rough manner.

I congratulate the honourable member for Hurstville on moving the motion. By doing so he has drawn to the attention of members a campaign that is taking place in his area which was initiated by the Mayor of Rockdale City Council, Kent Johns, who decided to take on the Commonwealth Bank by withdrawing the council’s business from the bank. Kent Johns has encouraged other councils to support the campaign. It is fantastic to hear about local communities standing up to corporate giants and demanding better service. The local community is most displeased that the Canley Vale branch of the Commonwealth Bank has closed and that the branches of the Commonwealth Bank in Fairfield are to close. I commend the motion to the House.

Mr O’FARRELL (Northcott) [4.33 p.m.]: I support the motion, and in so doing express my concern that the honourable member for Lakemba was not able to contribute to the debate. I know that he is a strong supporter of his constituents on this issue. As far back as two months ago he expressed to me the desire to move a motion on this matter in the House. Banking is meant to be a service industry. It is one of those industries that deals with people daily. The theme of the debate thus far has been that banks have lost their sense of service. The fact is that no-one should believe that greater efficiency and economic rationalism are inimical to service. At the end of the day, an enterprise will not survive, it will not be efficient, and it will not operate economically or rationally if it loses the people motive. I join with members on both sides of this House who have expressed concern that banks have lost their way and lost the service ethic that they are supposed to offer people.

In my electorate of Northcott, residents of Beecroft have suffered the loss of the Westpac bank, the National Australia Bank and Citibank. Thornleigh residents have lost all their banks - that is, the Commonwealth Bank, the Westpac Bank and the St George Bank. One has only to walk around Thornleigh, an area that is well known to the Minister for Urban Affairs and Planning, to see that the shopping centre is literally decaying. No-one goes to Thornleigh if they can go to another shopping centre where they can do their banking as well as their shopping. That has been the impact of the closure of those banks. As other members have said, the effect of bank closure is greatest on older people and young mothers who have children and babies in prams. They find it difficult to get around to different neighbourhoods to do their banking as well as their shopping.

It is particularly difficult for the people in my electorate, because in the past few years bus services in the area have been reduced so much that cross-regional routes are difficult to find. An elderly person or a mother with young children would find it very difficult to travel between neighbouring suburbs to do the banking. For some time the banks have been trying to encourage people to use electronic banking services. That is fine. However, yesterday morning my credit cards were stolen. I
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spent half an hour on the phone notifying the bank that the cards had gone. I suppose the good news was that as it was around 9 o’clock people would not have had the chance to spend up too much on my credit cards. If the banks are serious about improving efficiency and trying to sell the benefits of electronic banking, the system must be improved.

The honourable member for Cabramatta referred to delays in teller services in her local bank. If those delays are experienced with electronic banking, the banks have lost the plot again. Not so long ago we were all encouraged to use automatic teller machines or ATMs. We were told they would increase the services available to people. Some people suggest ATMs were put in place to reduce the number of staff in banks. Not long after most of us got used to using ATMs, and most of us made significant use of them, the banks introduced fees on the use of ATMs. Banks get it both ways: they reduce the level of service, they then introduce new services and raise their rates.

With regard to bank fees and charges, I opened an account with a bank when I took out my mortgage. The thing that appealed to me was that the bank promised never to introduce fees. Of course, three years later fees were introduced. Turnaround times for the crediting of cheques have increased. If a service is in the interest of the customer, it takes a long time; if it is in the interest of the bank, it takes a very short time. The same applies to credit cards and interest rate adjustments. If interest rates are increased, the new rates apply the next day; if interest rates are decreased, the new rates apply 30 days later. Service has disappeared.

The Hawke Government presided over the deregulation of the Australian financial system and implemented the Martin report in 1983. The Keating Government, despite making a solemn pledge not to sell the Commonwealth Bank - a pledge which it made during the election campaign in which the current member for Clarence first stood for Federal Parliament - immediately sold the bank when it was elected. Any opportunity that the Federal Government had to use the Commonwealth Government as a bulwark against further bank rationalisation was lost when the Keating Government sold the remaining 50 per cent of the Commonwealth Bank. I support the increased use of credit unions, and I acknowledge the actions of the Howard Government in giving credit unions permission to use a greater number of services. Last year credit unions were given greater access to the use of cheques and the like. It is only through that sort of activity that banks will receive real competition.

[Debate interrupted.]