The Federal Opposition has signalled it will be moving to ensure the two financial services regulators – the Australian Securities and Investments Commission (ASIC) and the Australian Prudential Regulation Authority (APRA) – adhere to a stronger set of principles around independence and objectivity.
In the same week that issues were raised in Money Management around the fact that two senior ASIC officials handling the Government's Future of Financial Advice (FOFA) regulatory changes had worked for Choice, with one having worked for Industry Funds Management, the Opposition spokesman on financial services, Senator Mathias Cormann, told last week's Financial Services Council conference the Coalition would be demanding a change in approach.
The two ASIC executives are commissioner Peter Kell and manager Nick Coates. Coates at one time worked for the industry funds grouping.
Cormann also signalled that unlike the current Labor Government, a future Coalition government would not be allowing the regulators to be a virtual partner in policy development.
He said the Government needed to drive policy development and then be accountable to the Parliament.
Addressing the Financial Services Council conference on the Gold Coast, the Opposition spokesman also appeared to reference the perceived failure by both ASIC and APRA to speedily answer questions on notice flowing from the Parliamentary committee process.
He said the financial regulators needed to take their accountability to the Parliament seriously and that, in Government, the Coalition would seek to ensure that both ASIC and APRA remained accountable to Government.
Cormann was also scathing of the Government's approach to translating its policies such as FOFA and Stronger Super into legislation and then regulation, and the manner in which this was currently impacting the financial services industry.
He committed a future Coalition government to putting in place a process through which both the legislation and resultant regulations were well in place before a new regime was actually gazetted to proceed.
The Opposition spokesman also appeared to signal the manner in which the Coalition would approach some of the perceived advantages handed to the industry funds movement during the term of the Labor Government.
He said a Coalition government would seek to return to the concept of "competitive neutrality" which had been pursued by the Howard Government in its implementation of the Financial Services Reform Act.
Cormann said adoption of the principal of "competitive neutrality" would ensure that some sections of the financial services industry were not allowed to enjoy any undue competitive advantage.
He said there were a number of elements of the Government's FOFA and Stronger Super legislation which were not consistent with the concept of competitive neutrality.
