The government has announced that Productivity Commission chair Peter Harris will not renew his contract in September and will be replaced by a former staffer to Liberal senator Nick Minchin.
Mr Harris, who led the Productivity Commission’s recent inquiry into competition in the Australian financial system, has decided against renewing his chairmanship after his contract ends on 10 September 2018.
He will be replaced on 11 September by Michael Brennan, who was recommended to the Governor-General by Treasurer Scott Morrison.
Mr Brennan previously served as a deputy secretary for the Victorian Department of Treasury and Finance before joining the Commonwealth Treasury as the deputy secretary of Fiscal Group.
“I congratulate Mr Brennan on his appointment and look forward to him making a significant contribution to the important work of the commission going forward,” Treasurer Scott Morrison said.
The Treasurer wished outgoing chair Mr Harris well, commending his “strong leadership and dedication in advocating for important public policy reforms” and his contributions to inquiries.
Mr Brennan’s appointment coincides with the appointments of Scott Morrison’s former chief of staff, Philip Gaetjens, to the role of Treasury secretary, as well as senator Mathias Cormann’s former chief of staff, Simon Atkinson, to the role of Treasury deputy secretary.
The appointments have been met with strong criticism from the Labor Party, with shadow Treasurer Chris Bowen saying: “Let’s get this right; Scott Morrison’s former chief of staff and Mathias Cormann’s former chief of staff have been parachuted into secretary and deputy secretary of Treasury roles.”
He added: “The next budget document the Treasury and Finance produces could be the independent pre-election Economics and Fiscal Outlook — and Scott Morrison appoints two prominent Liberal Party staffers into key, sensitive Treasury roles.”
Productivity Commission hands over report
The Productivity Commission’s final inquiry report into competition in the Australian financial system was handed to the Australian government on 29 June 2018, and is yet to be released to the public.
Mr Harris was a key figure in the public hearings, repeatedly expressing his concerns over “conflicted” broker remuneration structures, saying that they are “far aligned” from customer interests and that trail commission, in particular, “doesn’t make a great deal of logical sense”.
He stated in a hearing that it is difficult for the Productivity Commission to accept that trail commissions help “stop churn”, because “churn is a competitive opportunity potentially for a customer”, and therefore there is a conflict of interest.
Speaking at ASIC’s Annual Forum, the outgoing chairman additionally suggested that “the average $665 a year payment could be paid to the consumer not to switch loans” instead of brokers.
“[There’s] a good chunk of money out there paying for service for which there is no performance standard, which is an interesting development,” Mr Harris said.
[Related: FBAA calls out media ‘myths’ on broking]
Tas Bindi is the features editor for The Adviser magazine. She writes about the mortgage industry, macroeconomics, fintech, financial regulation, and market trends.
Prior to joining Momentum Media, Tas wrote for business and technology titles such as ZDNet, TechRepublic, Startup Daily, and Dynamic Business.
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