WA Senator Dean Smith calls for halt to bank closures amid new Senate inquiry

WA Senator Dean Smith has called for regional bank closures to halt while a newly-established Senate inquiry into closures is completed.

Prompted by bank closures across regional Australia in recent years, Coalition senators have launched an inquiry into the economic and welfare impacts of towns losing their face-to-face banking services.

The number of regional branches fell from 2500 to 1900 in the four years to June 2021, part of a 23 per cent nationwide decrease from 5800 to 4500.

Senator Smith said a banking outlet not only provided an essential service but also gave people a sense of security and optimism in their town.

“Local banks are one of the core components of regional communities and their closures badly hurt residents and businesses,” he said.

“From Derby to towns in the South West, I have seen first-hand how a physical branch closure or reduced operating hours has a negative flow-on effect on the entire community.”

Senator Smith said the closures meant in some cases small business owners had to close for the day to drive to the nearest open bank.

“While 88 per cent of adults in regional areas have internet access, and the data suggests a large number of them are using it for some form of online banking service, the more vulnerable or those in isolated areas must not be overlooked,” he said.

“Banks should look at the services they provide to regional towns as part of their social licence and consider the loyalty shown to them by customers over many decades.”

In September 2022, a petition was launched to stop the closure of the Tom Price Westpac branch — the only bank in the remote Pilbara town.

It followed the closure of the town’s United Credit Union branch closure in 2010.

Mining and Pastoral MLC and Tom Price resident Peter Foster, who started the 2022 petition, said it had left older residents who were not familiar with online banking in the lurch.

“We’ve got 3500 residents in tandem with numerous products from investment property, home loans, long-term deposits, kids have got savings accounts. It’s just terrible,” he said.

He said while there were still some face-to-face banking services offered through Australia Post outlets, many services were not available.

“You can only do a certain amount of banking there. You can’t open a bank account, you can’t close your account, you can’t change a signatory on a bank account and if you don’t have ID you won’t be served,” he said.

A Regional Banking Taskforce established by the previous Coalition Government in October 2021 reported its findings in September 2022.

The new inquiry was welcomed by the Financial Sector Union, which said it hoped it would examine in detail the plethora of issues that arise from bank closures, “unlike the Coalition regional bank closure taskforce”.

“The Coalition’s taskforce was a complete waste of time and money and was dominated and run by the banks,” FSU national secretary Julia Angrisano said.

“We had this farcical situation where the banks were overseeing an inquiry into themselves and consequently a range of important voices, including the FSU, were excluded from that process.

“This cannot happen again if this inquiry is to have any substance and impact.”

Submissions to the inquiry close on March 31 and can be made by any member of the public.

The inquiry is expected to report back to the Senate by December 1.