Much of the publicity around the announcement of the National Australia Bank (NAB) bid for AXA Asia Pacific (AXA AP) last month centred on concerns about competition, since the bank would considerably increase market share should the deal go ahead.
However, Leon Carter, the national secretary of the Finance Sector Union (FSU), said the Treasury and the Australian Competition and Consumer Commission (ACCC) should pay more attention to the repercussions for Australian jobs.
“It’s still unclear exactly where the cards are going to fall in terms of the bid for AXA AP, but from what we understand, NAB is in a better position to secure [the takeover],” Carter said.
“We’ve long said to the Government and the ACCC that the prism through which they look at these things is just too narrow. They will only consider the sort of stringent competition laws — they don’t look at what it means for the workers or the next level of competition and consolidation.
“Does anyone think now that losing this country’s fifth biggest bank was good for the banking industry? Everyone is now railing against the monopoly that the big four banks have, saying ‘if only there was an alternative’. Well, there was an alternative and it was called St George, and the Government and the ACCC signed off on it disappearing.”
The ACCC has commenced a review following NAB’s request for clearance regarding its proposed acquisition of AXA AP. The watchdog has invited feedback from interested parties and the closing date is February 5, 2010, following which they will release their findings on March 18. In the meantime, the ACCC is due to release its findings regarding AMP’s proposal on February 10.
Carter said the ACCC has enormous weight behind it and that any recommendation it makes is unlikely to be rejected. He therefore asserted that these types of deals needed to be looked at with a fine toothcomb, which might require legislative change.
“We’d say the Trades Practice Act should be amended to include employment matters, and in any consideration of a merger or acquisition there should be a public interest test.”
Carter said about 2,000 people work for AXA AP, yet no commitment has been made from either AXA AP or NAB with regard to employees. A NAB spokesperson said they were unable to comment on the proposal, or respond to concerns about competition and job losses, as they were still undergoing the due diligence process.
“There is no doubt that if NAB gets hold of AXA AP they are not going to want to duplicate all the systems and operations — it’s going to be job losses in the hundreds,” Carter said.
He said the FSU is seeking a meeting with Treasurer Wayne Swan to highlight the concern for jobs, which might help to ensure that employment conditions are attached to the deal, as was the case in the Westpac/St George merger.
