The financial services sector will contribute to industry funding of ASIC from 1 July this year after legislation creating the funding model passed through the Senate.
The ASIC Supervisory Cost Recovery Levy Bill 2017, which passed through the upper house on 15 June 2017, was first suggested by the Federal Government in April 2016 and follows recommendations from the 2013 Senate Inquiry into ASIC’s performance and the 2014 Murray Financial System Inquiry.
The Minister for Revenue and Financial Services, Kelly O’Dwyer said the funding model was “…a critical component of the Government’s plan to improve consumer outcomes in the financial services sector”.
O’Dwyer also said the model would improve equity in financial services “as only those entities that are regulated by ASIC and create need for regulation will bear its costs, rather than ordinary Australian taxpayers”.
ASIC chair, Greg Medcraft said the passing of the legislation was supported across the political spectrum and was an important milestone for ASIC and those it regulated.
“Industry funding, in one form or another, applies to other areas of public oversight in Australia and in many comparable economies around the world. Not only will the different elements of the broad business sector more fairly share the load, but the taxpaying public will benefit through the more accountable use of the funds provided for the task,” Medcraft said.
O’Dwyer said further regulations providing details on the operation of the funding model would be released before its commencement on 1 July, however, the cost per adviser has been estimated to be $960 per year (see: Proposed ASIC Funding Model Would Cost $1,000 Per Adviser)
This levy is one of the great injustices the risk advice community has had to bear. Is ASIC seeking a levy from the life offices/fund managers? Likely no. Why not? Because they simply have too much financial and political clout. ASIC wouldn’t get past first base and would spend millions on legal representation with no pot of gold at the end of the rainbow.
But they’ve simply wiped the floor with us. Noticeably, our professional associations, the AFA and the FPA have been conspicuous by their absence in raising a clamour over this. Not a word from them – nada, zilch, zero – yet we’re forced to be members now.
All of this adds significantly to the cost of doing business which is already mired in compliance and paperwork to the point that less than 20% of our time can be devoted to engaging in activities which generate income.
Challenging times ahead for many of us it seems.
Unfortunately Paul – challenging times for those who actually remain in the industry!
I should’ve become a politician instead.
So adviser fees go down and more onerous regulations are imposed, which add to the costs of running a practice and then another Thousand dollars is charged to pay the salaries of lawyers.
Do we get a choice as to how our money is spent, as the one common denominator when it comes to the legal profession, is that they charge high fees and continue to get paid, no matter the outcome.
There have been many cases of millions of dollars being spent of tax payers money, with ASIC chasing Corporations and crooked individuals to get justice, only to find there is no money to be recouped due to it all having disappeared, though after a costly court case, or lengthy legal chase, all we get as a return for our multi million dollar Investment, is a crook being banned, who does not care anyway as he or they have already siphoned their ill-gotten gains offshore or transferred the money to another person or entity that cannot be traced.
So I ask the question again, what guarantee do we get that our money will be spent wisely?
It’s not over yet wait and see how many more charges and fees pop up over the next 12 months
We are paying for other people’s failure to realise there responsibilities How sad with more education required more fees and associated charges the best of us
will end up the most educated people on the ” dole cue”
Another comment here on this. Is it even legal to levy this fee? Simply because the government decides on a course of action doesn’t automatically make it legal. This may be why the gov’t hasn’t tried it on with the legal profession and its practitioners. Can you imagine the backlash?
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