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Australia's federal election race is becoming more contested as opposition leaders and ruling backbench MP's continue airing their disquiet over Prime Minister Malcolm Turnbull's rejection of an investigation into the banking industry.
Australian banks are again at the center of local politics as the opposition Labor Party promised a Royal Commission inquiry into the banking industry following continued accusations over misconduct.
Last week, Australia's Westpac Banking Corp. became the second financial institution to be charged by the Australian Securities and Investment Commission (ASIC) over suspected rigging of the benchmark Bank Bill Swap Rate (BBSW).
The regular has already commenced court action against Australia and New Zealand Banking Group (ANZ).
"The fact is, the confidence and trust in the financial services industry has taken a huge hit over an ongoing range of scandals and high profile consumer rip offs," shadow treasurer Chris Bowen told Xinhua in a statement on Monday.
"We need Australians to have confidence in their banks and financial institutions, to sweep away the doubt, to uncover and deal with unethical behaviour that compromises that confidence."
It's been argued that Turnbull's lack of enthusiasm into a high-level inquiry of the banking industry, which has been plagued by scandals and probes surrounding financial planning and insurance scams, is a double standard given the two royal commissions into trade unions, key backers of the opposition Labor party.
Adding to Turnbull's woes in the lead up to a federal election, possibly as early as July, three of his government MP's have also publically supported a high-level investigation into the banking industry. But it's been alleged in Fairfax Media some of those MPs have a vendetta against the banks for personal reasons.
Industry representatives argue a royal commission would be a "serious distraction", damaging the reputation of Australia's financial industry, which famously withstood the 2008 Global Financial Crisis (GFC), and damaging its standing among global investors.
"We are not denying there have been problems, we are not denying there has to be ongoing scrutiny of the industry," Australian Bankers' Association chief executive Steven Munchenberg said.
"The question is do we need a Royal Commission to do that? No, we do not."
Australian banks are already heavily regulated, with regulators including ASIC and the Australian Prudential Regulation Authority (APRA) possessing the same powers of a royal commission to conduct investigations, with the added prosecutorial powers.
However, Bowen argues their capacity to conduct investigations of "wide-ranging and severe issues uncovered in recent years has become beyond the capacity of regulators" due to damaging funding cuts.
"Every Australian uses a bank and every Australian relies on the integrity of the banks, we need to restore that trust and confidence," Bowen said.
Australian Prime Minister Malcolm Turnbull has labelled the opposition's calls for an investigation into the financial services sector as a method to distract the Australian people from the fact Labor opposes the restoration of the construction industry watchdog, the Australian Building and Construction Commission (ABCC).
Turnbull has taken the political gamble of calling for an early, double dissolution election where every seat in both the House of Representatives and the Senate are contested on July 2 provided the Senate does not pass the bill to reinstate the building watchdog when parliament is recalled on April 18.
For a sitting government to spill both houses, a government bill must be rejected twice. It has already been rejected once.
The key cross-benchers of the federal senate said they would pass the legislation if the bill is broadened to encompass concerns about corruption in other sectors other than the construction industry which is heavily aligned to the opposition Labor Party, opening the door for official enquiries into the financial services sector.
