The Reserve Bank of Australia and federal Treasury have been systematically purging public information from their databases at the request of the big banks.
During the course of an investigation into the wholesale funding guarantee, BusinessDay found large swathes of information relating to the use of the guarantee had been expunged from the www.guaranteescheme.gov.au website.
This culling of public data follows revelations here last year that the corporate regulator, the Australian Securities & Investments Commission (ASIC) had been deleting evidence of the waivers it had provided to liquidators.
Commitment to transparency?
Now the RBA and Treasury appear to have made an even greater mockery of the government’s “commitment to transparency and accountability”. The funding guarantee scheme is an unprecedented concession for the banks – they are underpinned by the taxpayer and, thanks to sovereign largesse, cannot go bust.
Nonetheless, almost all detail relating to more than $100 billion in taxpayer-guaranteed funding has vanished. Only the details of current guarantees survive.
When requesting information relating to all funding guarantees, BusinessDay was met with this response from the RBA:
“The website lists all existing certificates. Details of expired liabilities are removed when requested by the relevant financial institution.”
When pressed for an explanation as to why a private financial institution could demand that public information relating to taxpayer support be taken off a public database, the central bank tweaked its message:
“The Reserve Bank publishes all current liabilities on the Guarantee Scheme website in accordance with our responsibilities under the Scheme Rules. If an issuer bank cancels a certificate, it is no longer a guaranteed liability and the certificate is removed from the website.”
Treasury had deflected the questions to the RBA after, incredibly, protesting that the information was “confidential”. Neither would comment on who was responsible for the policy decision to censor the information.
This all sits very oddly with “the Government’s continuing commitment to transparency and accountability” that is highlighted at the end of six-monthly reports on the guarantee schemes and the original undertaking in 2008:
“Details of the scheme, including participating institutions and the liabilities that are covered will be made available on a suitable public website,” promised Treasury.
Why then was it not possible to inspect particulars of every liability, ongoing or matured, in a straightforward Excel spreadsheet?
We can only surmise that both the government and the banks are trying to pretend there was never any corporate welfare in the first place. For the banks’ part, it is harder to justify $10 million executive salaries for running a taxpayer-guaranteed institution.
And for the government’s part, the censorship can only be put down to an obsequious backpedalling on previous public commitments in order to appease the powerful banks.
Unconvincingly trying to rationalise their role in the purge, Treasury responded that public information about sovereign support for the banks had suddenly become confidential.
“Further data on liabilities issued under the Scheme by individual participating institutions is not provided on the Guarantee Scheme website for reasons of confidentiality,” a spokesman told BusinessDay.
It was the sort of line which would have made Sir Humphrey Appleby proud.
With Europe in disarray, and the impending prospect of further taxpayer support for the banks – the RBA has recently foreshadowed relaxing the rules on what assets banks can swap for RBA cash – this is hardly the time for there to be any question over the integrity of public institutions and their information.