Treasurer Jim Chalmers has confirmed that he will introduce legislation to implement the review of the Reserve Bank of Australia (RBA) during the final week of November.
Speaking with ABC’s Insiders, the Treasurer also confirmed that he intends to announce the new deputy governor of the RBA before the central bank’s next meeting on 5 December.
Dr Chalmers said that the introduction of the RBA review legislation follows a long period of consultation with the RBA, the opposition, and other stakeholders.
“There’s been, I think, a really welcome public debate about the recommendations of the review that I released early in April. That’s been a good thing, and so we’ve taken into consideration all of that feedback, all of that consultation and collaboration,” he said.
“What people can expect to see in the RBA review legislation is keeping faith with the recommendations of the review but there have been a couple of instances where after that consultation and collaboration, we think we’ve got a better way to land the spirit of the review.”
Among the instances where the government will diverge from the RBA review’s recommendations relates to who will chair the new governance board.
“I intend to legislate the governor chairing that new governance board, at least for the first five years until we review it and make sure it’s working as we intended,” said Dr Chalmers.
“That’s been one example, a welcome example, of where the consultation has landed a position, which recognises the review said it was a line‑ball call.”
While the RBA review noted that there were “two sides to the argument” as to whether the RBA governor or an external member should chair the new board, it said that an independent external chair provided the best option for governance “on balance”.
The Treasurer said that the government believes it is appropriate for the governor to chair the RBA’s three boards while the bank undertakes a “big change management program”.
“We recognise that the reviewers said it was a line‑ball call, there were good arguments in both directions. We’ve done the consultation, and we’ve landed here,” he said.
“My interest here and my objective here is to land this change management program at the Reserve Bank. I’m confident that governor Bullock will help us do that, and that’s why at least initially, she will chair the three boards.”
Dr Chalmers also noted that Ms Bullock has been “deeply involved” in the government’s work to appoint a new deputy governor of the Reserve Bank.
“I’m hoping to announce the new deputy governor before the meeting of the Reserve Bank on 5 December,” the Treasurer stated.
“We have been interviewing a number of candidates from the shortlist – some internal, some external, some from Australia, some from overseas.”
While noting that candidates for the role have been narrowed down to a “quite short” list, Dr Chalmers indicated that more due diligence is still required.
“I want to make sure that I take it to the cabinet colleagues in the course of the next month, but we’re choosing between internal and external, Australian and overseas,” he said.
“We have been consulting very, very closely with Michele Bullock because we need to make sure that the deputy is someone who can work closely with her but also complement some of these other appointments that she will make.
These appointments include assistant governor (economic), a role held by Luci Ellis prior to her departure to Westpac earlier this year, and the new position of chief operating officer as recommended by the RBA review.
