A prickly subject


Peter Costello, Australia’s longest-serving treasurer and the man many have credited with setting the nation’s economy up to sail smoothly through the significant headwinds of the global financial crisis, was one of the keynote speakers at this year’s Financial Services Council Leaders Summit at the recently opened International Convention Centre in Sydney.

Costello shared some valuable insights about the establishment of the ‘twin peaks’ and ‘four pillars’ policies that govern Australia’s financial system today and were a product of the 1996 Wallis inquiry.

While the Howard government refuted the inquiry’s recommendation that mergers be allowed between the big four banks – hence the ‘four pillars’ policy – it agreed to adopt the suggestion that Australia establish two financial regulators, the Australian Prudential Regulation Authority (APRA) and Australian Securities and Investments Commission.

“In fact, the report recommended we call the prudential regulator the Australian Prudential Regulatory Insurance Commission, or APRIC,” Costello recalled.

“I said to my public servants: ‘How would we pronounce that?’ And they said: ‘A prick.’”

He continued that he of course vetoed the double entendre of an acronym in favour of the current APRA.

Who knows whether such a conversation did really occur within the walls of Treasury, but the yarn at least puts paid to the idea that the bookkeeper of the nation’s finances can’t have a sense of humour.