Coalition questions industry fund link to RBA
The Federal Opposition has questioned the appropriateness of a board member of a major industry superannuation fund sitting on the board of the Reserve Bank.
The question, which appears to go directly to the appointment of former Industry Australia chief executive Heather Ridout to the Reserve Bank board, has been posed by Tasmanian Liberal Senator, David Bushby to senior Treasury officials during Senate Estimates.
In a question, taken on notice, Bushby pointed to the rules precluding the director of a bank not being capable of being a member of the Reserve Bank Board.
"Having regard to the evolving nature of the financial system, with the creation of near banks and super funds, some of which hold assets far greater than some of the smaller banks, is there a need to review this provision?" Bushby asked.
He asked, "Is the Treasury aware that a recent RBA appointee holds a directorship with Australia's largest union super fund with assets exceeding $100 billion and investments in cash of billions of dollars?"
"If the answer to the above is yes, did Treasury give any advice to the Treasurer regarding how any potential or actual and perceived conflicts of interest could be handled in relation to this appointment?" the Liberal Senator asked.
His question then went on to say, "Given that on a Monday this person could be in receipt of sensitive interest rate data whilst at an RBA meeting, and on Tuesday sitting at a super fund directors meeting deciding whether to sell assets and go into cash or vice versa, isn't this a matter about which we should be concerned?"
Bushby also asked if any consideration was being given to amending the RBA Act to bring it in line with the contemporary financial sector in Australia.
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