Banking royal commission overhaul delayed due to coronavirus

 Image: Treasurer Josh Frydenberg (Source: Twitter)

The federal government has hit pause on the implementation of the banking royal commission recommendations for six months due to COVID-19.

Treasurer Josh Frydenberg made the announcement on Friday, saying the deferral will enable the financial services industry to focus on responding to the coronavirus economic crisis.

"The deferral will enable the financial services industry to focus their efforts on planning for the recovery and supporting their customers and their staff during this unprecedented time," he said in a statement.

Two rounds of legislation were due to be implemented this year - the first in July and the second in December.

"This announcement today balances the need to implement the recommendations of the Royal Commission with the need to ensure our financial institutions are in a position to devote their resources to responding to the significant challenges posed by the coronavirus," Mr Frydenberg said.

Under the updated timetable, measures slated to be introduced in June will now be introduced by December 2020.

Those measures originally scheduled for introduction in December will now be introduced by June 2021. 

Mr Frydenberg said the government had implemented 24 commitments and had made substantial progress on a further 35 through consultation and the preparation of draft legislation.

Consumer Action CEO Gerard Brody said the delay of the reforms wasn't a surprise.

"We appreciate that the fallout from COVID-19 has forced the Government to drastically change its priorities and focus in the short-term. We consider a six-month deferral of these much-needed reforms a sensible compromise," Mr Brody said.
 
"Any further delay creates a greater risk that progress towards these reforms will be lost and consumers – particularly those most vulnerable – will continue to suffer."

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