APRA deputy chair appointment sparks political backlash

The Albanese government’s choice of one its two new APRA deputy chairs has drawn criticism from the opposition, which has derided the appointment as “another Labor insider”.

Treasurer Jim Chalmers announced on Friday morning that APRA executive board member Therese McCarthy Hockey will continue to oversee the regulator’s activities in banking, while former Labor minister David Bradbury will have responsibility for superannuation.

Both will replace Margaret Cole, whose tenure as deputy chair ended on 30 June.

McCarthy Hockey, who was named by Professional Planner sister publication Investment Magazine during the masthead’s coverage of the process as a candidate for the role, is well-respected across the system. But Bradbury’s appointment sparked fierce backlash from the Coalition, with one senior party source calling it “a political appointment in the extreme” and shadow Assistant Treasurer Kevin Hogan saying it was “exactly what Australians hate about Canberra”.

“Another Labor insider. Another plum appointment. Another powerful job overseeing Australians’ money handed to someone from Labor’s own political network,” Hogan said in a statement.

“APRA is meant to be an independent watchdog. Its job is to keep the financial system safe and make sure banks, insurers, and superannuation funds are held to account.

“But Jim Chalmers has now appointed a former Labor minister whose role will be to oversee superannuation. This is a sector where Labor and big industry super have been joined at the hip for decades. To ordinary Australians that stinks.”

Bradbury is currently chair of the Board of Taxation, a role he intends to resign ahead of his commencement at APRA on 1 September. He was also a partner at KPMG, a role he has already resigned, and has held senior leadership positions at the Organisations for Economic Co-Operation and Development (OECD), including as deputy director of its Centre for Tax Policy and Administration.

More controversially, he was also parliamentary secretary to Treasurer Wayne Swan from September 2010 to March 2012 and was later elevated to the role of Assistant Treasurer and Minister Assisting for Deregulation following the 2012 Labor leadership spill where Julia Gillard remained as Prime Minister.

Following Kevin Rudd’s return to the Prime Ministership, Bradbury was sworn in as Assistant Treasurer, Minister for Competition Policy and Consumer Affairs, Minister Assisting for Deregulation and Minister Assisting for Financial Services. He later lost his seat to Fiona Scott – whom he had defeated in 2010 – in the 2013 federal election.

Speaking with Neil Mitchell in 3AW Mornings in 2012, Bradbury described super “as a Labor Party baby”.

“We introduced superannuation and this runs deep in our DNA. Mr Abbott on the other hand, in 1994 said it was the biggest con job ever foisted on the Australian people. What it shows is that there is a deep mistrust in the Liberal Party towards superannuation.”

Despite the criticism, Chalmers said the appointments bring the best available mix of strong leadership, experience and fresh thinking to the regulator.

“The appointment of two deputy chairs will enhance APRA’s capability to meet its objectives at a time of increasing scale and complexity in the financial system,” Chalmers said in a statement.

The selection process for the new deputy chairs was wracked by controversy when Investment Magazine reported that a number of senior industry and profit-to-member fund figures, including AustralianSuper CEO Paul Schroder, had lobbied the Treasurer’s office on their preferred candidate. AustralianSuper vehemently denied the allegation.

“Paul Schroder did not meet with the Treasurer or his office about the APRA role and he has not lobbied the government about it,” a spokesperson told Investment Magazine.

Treasury offered a host of character references for Bradbury, including from Mathias Cormann, secretary-general of the OECD and finance minister under Prime Ministers Abbott, Malcolm Turnbull and Scott Morrison, who said that “Australia’s financial system will be well-served by his leadership”.

“I have known David Bradbury for many years, both in Australian politics and later at the OECD,” Cormann said. “I can think of few people better equipped to serve as deputy chair of APRA. He combines deep policy expertise, sound and balanced judgment with real integrity and a real understanding of financial systems.”

Bradbury’s appointment also comes as KPMG finds itself in the midst of an audit-integrity scandal centred on whistleblower allegations that the firm misused confidential client information to win audit work.