Regulators’ ‘stakeholder’ status better defined
The Federal Government appears to have placed a limit on the "stakeholder" status granted to the financial services regulators by the previous Labor Government.
While both the Australian Securities and Investments Commission (ASIC) and the Australian Prudential Regulation Authority (APRA) were granted significant "stakeholder" input into the development of Government policy such as the Future of Financial Advice (FOFA) and Stronger Super during the terms of the Rudd and Gillard Governments, the Federal Treasurer, Joe Hockey, has reasserted the primacy of the Treasury as the key source of policy advice.
However ASIC's response to Government's Statement of Expectations, suggests it does not intend to unduly reduce its direct interactions with the Government.
The Government's key positioning was made clear in Statement of Expectations to the financial services regulator and appeared to be reflected in the responses received from ASIC and APRA.
The State of Expectations relating to ASIC states: "Treasury's key role is to support and advise me and other Treasury Ministers in our responsibilities by being the principal source of advice on a wide range of issues including policy development and the performance of the regulatory system.
"The Government expects that Treasury and ASIC will maintain a close relationship. Treasury takes into account the views and experience of ASIC when considering and advising on changes to financial and corporate policy and legislation to facilitate consistency between the objectives of legislation and its practical implementation. By advising Treasury on the operational implications of Government policy initiatives, ASIC contributes to policy development."
However in its response, acknowledged by Hockey last week, ASIC said that while it "recognises Treasury's role in supporting and advising the Treasurer and other Treasury portfolio ministers. We will continue to work closely with Treasury as we develop substantive operational policies and keep the Secretary to the Treasury informed of significant interactions with Ministers.
"To support Treasury's role as the principal source of advice on policy development and the performance of the regulatory system, ASIC will copy information to the Secretary of the Treasury in parallel to that information being provided to Ministers. This is subject to ASIC's position as an independent agency and any legislative requirements that may limit our ability to provide such information to Treasury."
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