Australian Liberal Senator Andrew Bragg has hinted at the idea that blockchain technology could be the answer for reducing complications associated with financial regulatory compliance and delivering transparency.
"The future is technology by blockchain," he said, speaking on Wednesday during the Future of Financial Services 2020 virtual conference.
"It may well be the solution to one-touch government with international transactions in real time. It will eliminate our time zone problem, which has been a problem for Australia over the long run … blockchain technology can streamline regulatory processes, reduce fraud, and reduce costs to regulatory compliance and administration.
"It can help Australia rebuild confidence and trust in financial services in a post-Hayne Royal Commission world."
Bragg also highlighted the importance of enhancing Australia's global competitiveness in the financial sector, particularly against Singapore.
"Singapore's ambition is to build the world's first global data exchange, and we're going to have to lift our game to compete with that," he said.
One suggestion he made was for Australia to look at Hong Kong as a potential growth market.
"Hong Kong will still be an important gateway to China, but because of the recent turmoil there and the foreign influence laws, they won't have the same regional headquarter attraction. We would be mad to sit idly by and allow such a lucrative share of the market to lead to Singapore or to Tokyo," Bragg said.
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Following through on this belief, Bragg said a 15-member advisory group has been set up to "come up with ideas to help Australia capitalise on the demise of Hong Kong as a financial and technology hub" and "bust through bureaucratic roadblocks and produce credible policy advice to cabinet ministers and the Prime Minister's special convoy for global business and talent attraction".
Bragg's proposal comes as trade tensions between Australia and China continue to rise. According to ABC News, multiple Chinese importers have received directives from the Chinese government to halt shipments of Australian wine. This would be in addition to other Australian exports that have already been targeted by various forms of restrictions in the Chinese market, such as coal, barley, timber, and lobsters.
Equally important to Australia's economy is its ability to attract international business and talent, Bragg said. According to the senator, Acting Minister for Immigration Alan Tudge's recent announcement to establish a "strike team" to lure international business into Australia, particularly in the fintech, financial services, advanced manufacturing, and health sectors, was a good first step.
"Australia as a financing centre has been a dream for decades. The dream will only come to fruition if the government is prepared to change. And by that, it means we may need to change the way we regulate and administer tax laws. We may need to offer tax deals to companies to lure them," Bragg said.
Bragg also reinforced the idea that Australia's Consumer Data Right (CDR), which was officially launched on July 1, should be expanded to include the superannuation sector. He believes the move would enable people to easily choose their own super fund.
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This was one of 22 recommendations that the Select Committee on Financial Technology and Regulatory Technology, which is chaired by Bragg, had handed down in its interim report on the state of fintech and regtech in Australia two months ago.
"I'm often misquoted saying that I want to wreck super. That is not true. I think super is a good idea but after 30 years, it needs fixing … the beauty about CDR is it cuts through all the industrial archaeology, which the unions cling on to for dear life and relevance," Bragg said.
"Accordingly, I believe the new rails for super will be stapling, plus CDR, one fund, and easy to move. This will stop the creation of millions of unintended multiple accounts and throw around AU$3 billion back into the savings pool over the next 10 years."
Bragg added that in the remaining months of the committee, it would "look at longer term views of technology as a driver of future jobs and economic growth".
"We need to make it easier to become a global player," Bragg said.