The Coalition has reversed its stance on a key recommendation of the independent review of the Reserve Bank of Australia (RBA), saying it will not pursue a proposed restructure of the RBA board if elected.
Reversal of in-principle support
This decision is an about-turn for the opposition, which previously expressed in-principle support for splitting the board into two entities: one to manage interest rate decisions and another for governance.
Last week, shadow treasurer Angus Taylor announced the Coalition’s opposition to the Labor government’s plan, expressing concerns that the Treasurer, Jim Chalmers, would fill the board with Labour-aligned appointees.
Despite initially endorsing the recommendation for a dual-board structure, the Coalition now believes that the current setup should remain intact.
Jane Hume, the Coalition’s finance spokesperson, confirmed the new position during an interview, asserting that the board’s structure no longer warranted reform.
Hume argued that stability and continuity were priorities for the party, rejecting further discussion on the matter.
Coalition set up the review
The decision is a departure from the findings of the independent RBA review, which was commissioned by former Coalition treasurer Josh Frydenberg and released by ALP incumbent Jim Chalmers.
The review advocated for a two-board structure, a model employed by central banks globally, as a means to enhance expertise and scrutiny in interest rate decisions.
With the Coalition no longer backing the bill, the government will now need to rely on support from the Greens and other Senate crossbenchers to pass its RBA reform legislation.
Meanwhile, the political debate over government spending continues, with both parties trading accusations over fiscal responsibility.