Hard-pressed financial advisers hit by large Australian Securities and Investments Commission (ASIC) levy bills have the ability to seek hardship relief, according to the regulator.
What is more the most senior executives within ASIC are claiming that in about two years’ time financial advisers may actually experience lower levy bills as the costs associated with the increased regulatory costs associated with the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry wash through the system.
But the ASIC executives side-stepped a suggestion by Queensland Liberal back-bencher and former financial adviser, Bert van Manen, that it is the banks rather than small financial planning practices which should be meeting the cost of the much-increased levy.
While ASIC deputy chair, Karen Chester and commissioner, Danielle Press acknowledged that the underlying reason for the significant increase in the levy was the unusual coincidence of a “denominator” and a “numerator” in the same year, outgoing ASIC chair, James Shipton acknowledged financial planning industry concerns about the overall cost and the availability of hardship relief.
“We are open to receipt for applications of hardship and allowance for that,” he told a hearing of the Parliamentary Joint Committee on Corporations and Financial Services.
van Manen had earlier referred to answers given by Chester and other members of the ASIC executives which he said had referenced the big end of town – the banks and AMP.
“[Your] answers are consistently referring to the big end of town but it is small business owners who end up paying the price for actions of big end of town,” he said.
“Do you have capacity to ensure that those who incur the large costs bear the commensurate responsibility to pay the levy while those who do not not, pay the levy at a reasonable rate. Do you have the ability to differentiate?” van Manen asked.
Chester said that there was already a gradation formula in the levy but acknowledged that it had been significantly impacted by actions brought about by the Royal Commission a large part of which related to enforcement.