The Labor Opposition has held up the introduction of a swag of government bills to parliament by demanding a royal commission into Australia’s banking system, accusing the Coalition of running a “protection racket”.

Opposition Leader Bill Shorten called on Parliament to recognise that scandals in the banking sector had ripped off Australians, including retirees.

“[The prime minister] and his coalition are running a protection racket to protect big banks of Australia,” he told Parliament on Wednesday.

Mr Shorten said a royal commission was the only avenue that had the necessary coercive powers and jurisdiction to deal with bank misconduct.

“Australians are sick and tired of the scandals being investigated after the harm is done,” he said.

“They’re sick of the speeding fines being issued to the banks.”

Labor wants to know how widespread the problems are and whether Australian regulators are equipped to monitor the sector.