A key factor in Australia’s record 28 consecutive years of economic growth was the strength and performance of our financial system. Representing about 10 per cent of the nation’s GDP, it is the single largest sector of the economy. With more than 15 million Australians having a superannuation account and more than three million households holding a mortgage, the sector is fundamental to the financial ecurity and wellbeing of us all. While Australian banks withstood the stresses of the global financial crisis, outperforming their global counterparts, praise for this performance masked other problems in the sector now exposed.The royal commission into the Australian banking, superannuation and financial services industry revealed the extent of misconduct and the degree to which many of our financial institutions were acting below community expectations.Fees for no service, charging dead people, pressure selling of worthless insurance and firms misleading regulators were just some examples.With more than 10,000 public submissions, 130 witnesses and 68 days of hearings, the royal commission put the sector under the microscope and found it wanting. In Commissioner Kenneth Hayne’s own words, “two themes recurred: dishonesty and greed”. In his final report, delivered six months ago, the commissioner made 76 recommendations, 54 of which were directed to the government, 12 to the regulators, and 10 to the industry. The recommendations were focused on delivering better consumer outcomes in four key ways: Strengthening and expanding consumer protections, including for small businesses and regional communities; Raising accountability and governance standards; Enhancing the effectiveness of the regulators; and Providing remediation for those harmed by any misconduct. Within four days of receiving the more than 1000-page final report, the government provided a comprehensive response committing to take action on all 76 recommendations. The government went further, making an additional 18 commitments as part of its response. Since then the parliament has sat for 21 days and the government has implemented 15 of its commitments. This comprises eight of the 54 recommendations directed to government by Commissioner Hayne and seven of the additional government commitments. For example, the government has passed legislation to prevent superannuation funds inducing employers with gifts or hospitality so as to influence the choice of default fund for their employees. The remit of the Australian Financial Complaints Authority has been extended by an additional four years back to 2008 to enable more consumers to have their cases heard and in doing so receive compensation for misconduct. The government has responded to a capability review of APRA by Graeme Samuel, which is leading to important reforms including a greater focus on member outcomes in superannuation. Today the government lays out an ambitious timetable to implement the royal commission’s remaining recommendations. Excluding the reviews to be conducted in 2022, by the end of this year more than 20 commitments — about a third — will have been implemented or have legislation before the parliament. By the middle of next year, more than 50 commitments — almost 90 per cent — will have been implemented or have legislation before the parliament. And by the end of next year the remaining royal commission recommendations requiring legislation will have been introduced. The scale of these reforms, detailed in the government’s implementation plan, represents the biggest shake-up of the financial sector in three decades and the speed with which they will be implemented is unprecedented. Our reforms will be delivered in a way that enhances consumer outcomes with more accountability, transparency and protections, without compromising the flow of credit and competition. Achieving this ambitious timetable will require additional resourcing that the government has committed to as it is anticipated that giving effect to the Implementation Plan will make up 75 per cent of Treasury’s legislative agenda over the next year. The Treasury legislative program typically represents a quarter of the total government legislative program. Given the scale and complexity of implementing the royal commission’s recommendations, it is critical that the parliament deals with these reforms constructively and with a sense of urgency. The government will ensure that the opposition is fully briefed by Treasury on the Implementation Plan and the individual pieces of legislation required. Industry is on notice. The public’s tolerance has been exhausted as they now expect, and we will ensure, that the reforms are delivered and the behaviour of those in the sector better reflects community expectations. To this end, the government will establish an independent review in three years’ time to assess the extent to which changes in industry practices have led to improved consumer outcomes and the need for further reforms. There is no understating the importance of the royal commission and its findings to the critical task of restoring trust in Australia’s financial institutions. Commissioner Hayne was clear in his diagnosis of the problem and deliberate in his prescription of the solution. The road map released by the government today underlines our determination to bring about change to the financial system by implementing the commission’s recommendations swiftly and effectively. Opinion Piece originally appeared in The Australian, 19/8/2019.