Delayed reforms to the Reserve Bank have hit another roadblock, as the opposition rejects concessions put forth by the federal government.
Shadow Treasurer Angus Taylor remains unsatisfied with Treasurer Jim Chalmers’ olive branch, saying there’s still potential for the new interest rate setting board to be stacked with Labor appointees.
Recommendations from a review of the RBA in 2023 called for a dual-board structure, one for setting interest rates and a separate one for governance.
To allay Mr Taylor’s concerns of a “sack and stack strategy”, Dr Chalmers said all existing board members would go on to the interest rate board unless they chose not to.
That was not enough to satisfy the shadow treasurer, who said the door was still open to a “stitch up”.
“And at a time like this, the most important point here is we need every weapon we have fighting inflation and high interest rates in this country,” Mr Taylor told Canberra radio station 2CC.
Dr Chalmers slammed the position, arguing he had negotiated with the opposition in good faith and “put a premium on bipartisanship”.
“I tried to take the shadow treasurer seriously, even though nobody else appears to,” the treasurer told reporters in Canberra.
Potential appointees had been run by the shadow treasurer and Dr Chalmers said Mr Taylor was not genuinely worried about the board make up but rather “playing politics”.
“The Reserve Bank reforms are all about making the RBA more independent, not less independent, and the position that the coalition has taken shows that it has absolutely no idea and absolutely no economic credibility,” he told reporters on Tuesday.
A return to the negotiation table was still possible, but the door had also been open to discuss the legislation with the Greens.
Shelving the changes entirely was also a possibility.
Concessions have already been made on another controversial change to scrap the veto rule to override interest rate decisions, a change opposed by the Greens and a string of former central bank governors.
Under the revisions put to Mr Taylor in a letter last month, the parliament would maintain the override power but it would be limited to emergency circumstances only.
