Assistant Treasurer Josh Frydenberg said on Fridsay an industry funding model for the Australian Securities & Investments Commission (ASIC) would provide the regulator with more certainty and enhance the transparency of its revenues and costs.
Currently only about 15% of ASIC’s regulatory costs are recovered through charges on the industry, with the remainder funded by the taxpayer.
ASIC has welcomed the news noting that its costs are now significantly out of line with the revenue it is able to collect from the sectors it regulates.
“An industry funding model is about ensuring that those industries that need the most regulation should pay for it, rather than taxpayers,” said ASIC chairman Greg Medcraft.
ASIC has undertaken a series of high profile investigations into misconduct by financial service providers in recent years covering major players such as the Commonwealth Bank, Westpac, the National Australia Bank, the ANZ Bank, AMP, Macquarie Group and IOOF Holdings among others.
The decision to shift to a ‘user pays’ system for funding ASIC follows last year’s financial system inquiry, chaired by former Commonwealth Bank boss David Murray, which recommended that the government should move to adopt an industry funding model, similar to that already in place for other Australian regulators.
The closing date for submissions is 9 October 2015.