The Federal Government has announced a $127.2 million reform package for the Australian Securities and Investments Commission (ASIC) with the bill to be footed by industry players and banks.
In a joint statement, Treasurer, Scott Morrison, and Assistant Treasurer, Kelly O'Dwyer, said the Government has adopted recommendations made by the Financial System Inquiry and introduced an industry funding model where ASIC costs would be recovered from all industry sectors regulated by ASIC.
"Industry funding ensures that the costs of regulation are borne by those entities that have created the need for it, rather than the Australian public," Morrison said.
Industry funding would set up price signals and dictate how resources were allocated within the corporate regulator to boost its transparency, he added.
ASIC welcomed the reforms, and was pleased with the introduction of an industry funding model.
"ASIC has long believed that those who generate the need for regulation should pay for it," Chairman Greg Medcraft said.
ASIC would also receive $57 million for surveillance and enforcement on an ongoing basis, especially in financial advice, responsible lending, life insurance and breach reporting.
It would also receive $61.1 million to boost its data analytics and surveillance capabilities and its information management systems.
Furthermore, ASIC will receive $9.2 million to implement a product intervention power to enable it to respond to market problems, product distribution obligations to enhance a customer-centric culture in the industry, and a review of its enforcement system to ensure penalties are appropriate and deter misconduct.
The Government will also set up a panel to review the role, powers and governance of all financial system's external dispute resolution and complaints schemes, while also extending Medcraft's role as chairperson for another 18 months to oversee the implementation of these reforms.
An additional commissioner will also be appointed to ASIC to assist existing commissioners and Medcraft.