The Federal Government introduced the Australian Securities and Investments Commission (ASIC) industry funding model into Parliament on Thursday, which seeks to recover the corporate regulator’s costs from “entities that create the need for regulation”.
Minister for Revenue and Financial Services, Kelly O’Dwyer said the ASIC Supervisory Cost Recovery Levy Bill 2017 and related bills required to implement the funding model would boost transparency, make industry more accountable for its behaviour.
“This is the next step in implementing the Government’s commitment to recover ASIC’s regulatory costs from the entities that create the need for regulation, rather than the Australian taxpayers who too often bear the costs of financial sector misconduct,” O’Dwyer said.
Assistant Minister to the Treasurer, Michael Sukkar told the House of Representatives the funding model, to be implemented from 1 July 2017, would improve equity in tax collection.
“Because each regulated subsector will only ever pay an amount equal to its costs of supervision, industry funding will promote equity between different regulated entities,” Sukkar said.
“This is because certain industry subsectors will no longer cross-subsidise the costs of regulation of other sectors.”
Sukkar added the bill would equip ASIC with new powers to collect more granular data from regulated entities on the services they provided, such as credit amount provided, which would aid in calculating levies owed by each institution.
Institutions and entities must pay the levies after the end of the relevant financial year and any unpaid levy would attract penalty interest at the rate of 20 per cent per annum.
This bill was in addition to the $127.2 million provided to ASIC to boost its powers, data analytics and surveillance capabilities and implement measures recommended in the Financial System Inquiry (FSI).
Other measures included a review of ASIC’s enforcement and penalties regime and the ASIC capability review to ensure it complied with global best practice.
The bill also included enhancing ASIC transparency, where, from 2017/18, it would have to annually outline its regulatory priorities, how it intended on tackling them, and provide detailed accounts of how efficiently it delivered its objectives, including justification for the money it spend and the regulatory tools it used, Sukkar said.
O’Dwyer said the Government would release draft regulations with greater detail on the operation of the model for consultation in the coming weeks.