Speaking on ABC’s AM radio show, Garry Weaven calls on the Federal Government to rewrite the Reserve Bank’s charter so to start healing a damaged economy.

 

Mr Weaven believes the Reserve Bank focuses too strongly on inflation and attetudes imposed when Peter Costello was Treasurer in 1996 is now “totally inappropriate."

 

"It seems to be still unduly influencing the Reserve in its policies. I know it's very hard to get the balance right, but I think consistently for many years now the Reserve has had far too much focus on inflation only and not enough on full employment and economic prosperity generally, which is their requirement under the Act," Mr Weaven said.

 

"It's hard to see that the current arrangements are properly co-ordinated. And I think there seems to be little point in having a situation where the Reserve is locked into a sort of single blunt instrument approach and the Government is locked into a political set of parameters."

 

“Notwithstanding the mining boom, we do have signs of real weakness in retail and manufacturing. But more importantly in a way, we have very high interest rates by international standards. And high interest rates push the currency high and that's very, very bad for manufacturers, tourism and some other industries," said Mr Weaven.

 

Garry Weaven is a former ACTU assistant secretary and currently oversees $120 billion worth of superannuation investments including AustralianSuper, Cbus and Hesta.

 

You can listen to the full transcript of Garry Weaven's interview with the ABC here