ASIC should be self-funded, says ISA

Industry Super Australia (ISA) has suggested a self-funding model for the Australian Securities and Investments Commission (ASIC) after numerous concerns were raised that the budget allocated to the regulator by the Government was inadequate.

In its submission to the Senate Economics References Committee into the performance of ASIC, ISA highlighted that other regulators — such as the Reserve Bank of Australia and the Australian Prudential Regulation Authority — were largely funded by fees imposed on the entities they supervise.

There have been suggestions that ASIC can replace government funding with the industry levy model, which would give the regulator the ability to independently organise and plan its operation budget, ISA said in its submission.

"For this fee-paying model to work, it is necessary to have a process which clearly defines the types and amount of fees paid by firms and how fees are raised," it said.

"More importantly, there needs to be a clear accountability framework for the regulator to operate in. This should detail the regulatory body's responsibilities, reporting duties and also outline criteria for a periodic auditing process."

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Essentially, the sectors that required the most supervision would be paying the most, ISA added.

To further support its case for the introduction of a self-funding model for ASIC, ISA's submission pointed to the regulator recently citing "resource limitation" as a reason for the delay in solving the Commonwealth Financial Planning case, as the same team had to deal with problems from the Storm Financial collapse.