18 May 2021

I acknowledge the Gadigal people, the traditional owners of the land on which we meet and pay my respects to their elders, past, present, emerging.
It’s great to be here and see so many of you in person.
I love the convenience of Zoom, but it’s not the same.
I think one of the things we’ve learnt over the COVID crisis is, yes, technology can really help in times of crisis and change, but also, nothing can ever really replace human contact.
COVID has taught us many things: how to adapt quickly, how to do business, government, even politics, differently. 
It’s also shone a spotlight on the underlying weaknesses and social inequalities and given us the opportunity to reassess the things that matter most.
And I guess that’s a good way to get into what I wanted to talk to you about today.
COVID has changed some things for good. It has also accelerated changes that were already underway.
Working from home, the explosion in online commerce and cashless transactions are three obvious examples.
Between March last year and March this year it grew by a staggering 38 per cent, driven by locked down shoppers looking for alternative ways to buy things.
Even now, with the malls and local shops back open, there has been just a small dip in online shopping, suggesting Australians are now very comfortable with the experience.
When people have gone to the shops over the COVID period, both shopper and retailer have sought to make transactions as safe as possible from a health point of view.
This has accelerated another trend.
Where a year ago around one in 12 businesses were cashless, now it’s one in four.
Once again, this is a trend consumers have taken on board quickly and have now accepted as a normal part of their lives.
Last year, around 36 per cent of in-person transactions were made using cash.
At the height of the pandemic, that crashed to 15 per cent where it has more or less stayed ever since.
The Buy Now Pay Later Sector has enjoyed a significant share of this spectacular growth with younger consumers more likely to use one of these products than a traditional credit card. 
Of course this presents challenges for regulators. 
My own view is these products should be viewed for what they are: credit products.
While it is tempting to give a new name to something that is driven by new technology, in my book if it walks like a duck and quacks like a duck, it’s a duck.
It should be appropriately regulated as a credit product.
I welcome the Buy Now Pay Later Voluntary Code of Conduct which came into being in March.
It’s a good step forward and something AFIA is and should be proud of.
It will not surprise you to hear Labor will be keeping a close eye on whether it’s doing the job it sets out to do, namely providing vulnerable consumers with the right protections.
It is important we get effective guardrails in place to ensure we have a financial system that delivers not just new ways of transacting commerce, but confidence and security along the way.
This is important.
I haven’t said too much about the Hayne Royal Commission but I do want to mention the Responsbile Lending Obligations. 
There could not be a worse time to ditch the first recommendation of the Banking Royal Commission on Responsible Lending Obligations. 
It is a political orphan. 
If the regulatory guidance on implementing a fairly basic obligation of suitability and affordability need a tune up then we should do that, but babies should not be discharged with bathwater. 
There is absolutely no evidence responsible lending obligations are constricting the lending pipeline, as soaring house prices will attest.
Perhaps it would be better if we had responsible borrowing laws put on the Government instead.
Where the COVID crisis accelerated some trends, others it has created almost on its own.
Working from home was something very few of us ever thought we’d be doing as a matter of course in our jobs.
While I don’t expect working from home to ever again quite reach the heights it did during the lockdowns, it is reasonable to expect it to be an ongoing part of a lot of workplaces.
This again has huge implications for the financial services and fintech industry.
More working from home means less commuting and greater demand for new transport options.
For some workers, owning a car might make less sense than before but signing up to a car share alternative might make more sense.
For some businesses, office sharing will be a better alternative going forward.
It will also change regional economies and regional economic development strategies. 
We can see this well underway in the soaring house prices in the Central Coast, Illawarra, Hunter and Blue Mountains as the a sea or tree change becomes as attractive to the 30-somethings as it has to those looking for a transition to retirement option. 
To grasp the challenges and the opportunities these trends present will take a strong fin tech industry there with the innovation and know-how to smooth the transition.
This is also true for workers who decide not only to abandon their old schedules as full-time in the office, but the cities in which they live.
Skyrocketing major city house prices combined with the increased ability to work remotely have the potential to open up new opportunities for regional economies.
Again, the finance industry will be at the leading edge to facilitate this and help contribute to the rebirthing of our economy.
And this is a good thing because right now our economy, wallowing in sub-par productivity growth, needs new innovation.
This requires access to finance and intermediary services.
I am optimistic about what business can do …. The future can be bright, but there is a weight dragging upon this. 
For some time Labors has  worried that the Government’s greatest ambition is to wind back the clock to where we were before the pandemic. 
This is not only a lost opportunity, it means winding the clock back to some pretty unsatisfactory outcomes. 
Business investment at historically low levels.
The worst wages growth on record.
Casualisation of the workforce has become endemic, with two million Australians today either out of work or looking for more hours.
On that issue, the pandemic exposed a major fragility which must be addressed.
Very high rates of casualisation in the service industry proved to be a vector for the spread of the virus.
Once we thought insecure work was a problem for those engaged in it.
Now we understand that it is a social issue with significant consequences for the community at large.
Workers with multiple jobs attended multiple workplaces just to earn a living. 

Many were engaged in frontline roles that meant they couldn’t work from home, couldn’t protect themselves and ultimately, through no fault of their own, endangered the community.
This time last week the Treasurer had an opportunity to address these problems when he handed down the Budget.
He failed.
He failed to set a clear direction for our economic future, despite racking up record debt and deficit.
He failed to make fixing low wage growth, continued casualisation and stagnant business investment a priority.
He failed to set an economic course that would see us build back better from the pandemic.
Instead he set a political course for a government focused on its own survival at the next election.
This is not a trifling matter.
Without a vaccine plan, there is no economic plan because we will live, to quote Innes Willox of the Australian Industry Group, in a guilded cage, marginalised from the rebounding global economy.
There is another key point. 
We cannot truly talk of an economic recovery unless it is a recovery that is enjoyed by Australian families. 
This means an improvement in their living standards.
An improvement in living standards requires a shift in wages. 

It’s simple – unless households enjoy a share of economic growth through rising wages, there is no economic vision.
The Liberals see wages as a business expense.
But the pandemic has taught us low wages are a threat to our economic wellbeing.
It has demonstrated that wages support aggregate demand, particularly wages at the low end of the scale where workers have no discretionary spending and return every dollar they earn back into the economy.
Increased casualisation means even when unemployment numbers are going down, wages remain supressed.
Yet there is no plan from the Government to deal with these issues, just a cash splash to neutralise their opponents.
Of course it is not just government that has a role in rebuilding our economy.
To build back better we also need business investment to pick up, and in this the finance industry has a critical role to play.
You have shown over the pandemic an impressive ability to roll with the punches and keep delivering for your customers whatever the circumstances.
This is an important trial run for the challenges ahead as new businesses, and new ways of business, are formulated.
That’s a challenge I have every confidence you will meet.
Thank you for your attention.