The Labor Party has promised to hold a royal commission into misconduct in banking and financial services if it is elected later this year.

“Australia has one of the strongest banking sectors in the world and we want to keep it strong,” Opposition Leader Bill Shorten said on Friday.

“But public confidence in the banking and financial services industry has taken hit after hit over the previous few years.

“Many Australians have suffered through the decisions of banks and financial institutions.”

Mr Shorten says the proposed royal commission “includes insurance”, but did not differentiate between life, health and general insurance.

He says issues with life insurers not paying claims are among the reasons for Labor’s push.

“There are literally tens of thousands of victims, if not more,” he said. “And today I say enough is enough. This string of scandals has to stop.”

The Australian Bankers’ Association has attacked Mr Shorten’s call as “unnecessary and a waste of taxpayers’ funds”.

Labor has estimated the royal commission would cost $53 million over two years.

“Banks do accept that in the past they have not always lived up to their own standards, let alone those of their customers,” Bankers Association CEO Steven Munchenberg said.

“That is why we have seen new regulations introduced for banks. The issues the… Labor Party is talking about have already been examined.”

Shadow Treasurer Chris Bowen says the financial services industry needs the confidence of consumers.

“The royal commission will look at how widespread instances of illegal and unethical behaviour are in the financial services industry,” he said on Friday.

“How our financial services industry understands and gives effect to its duty of care to consumers, how the culture, ethical standards and business structures of Australia’s financial institutions affect the behaviour of employees and their operation in financial markets, and whether Australia’s regulators are well equipped to identify and prevent illegal and unethical behaviour in a financial services sector.”

Mr Bowen says the commission would cover insurance companies, superannuation funds, credit unions and friendly societies in addition to the banking sector.

“It’s targeted at the financial services industry, because…in the scandals we’ve talked about and we’ve seen, these issues can arise at various points from the financial services industry. It’s not just banks.”