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The government’s backflip on axing mortgage broking commissions shows that there is scope for ASIC’s industry funding model to be revisited, says one professional association.
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Government called to revisit ASIC industry funding model in view of 'all the facts'
01 April 2019
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9 minute read
CPA Australia’s general manager of external affairs Paul Drum believes that the government’s response to the lobbying of the mortgage broking industry over the banking royal commission’s recommendation that commissions be abolished means the accounting industry’s acrimony towards ASIC’s industry funding model stands a good chance of being heard.
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“We’ve already seen this same government, on one hand say, we accept all the Hayne royal commission recommendations in principle but then the treasurer comes out and says we don’t accept the recommendation on mortgage brokers – so it demonstrates a track record of changing its mind when it is aware of all the facts,” Mr Drum told Accountants Daily.
“The question is if they are aware of all the facts about ASIC’s self-funding model, it might be time for them to actually revisit it and say perhaps they were a bit hasty going down that path.
“The whole argument about mortgage brokers was similar – the government said it was about market concentration and lack of services and it is exactly the same argument when you are looking for a registered company auditor, for an SMSF auditor or looking for a qualified financial planner.”
Despite the government announcing a $550 million funding boost to ASIC and APRA last week, ASIC has since released its latest indicative levies for the 2018-19 year.
Registered liquidators will face a $2,500 levy plus $81 per appointment and notifiable event, up from $77 last year.
Registered company auditors will be billed a $217 flat levy, up from $209, with auditors of disclosing entities to pay $133 per $10,000 of revenue.
Australian financial services licensees that provide personal advice to retail clients on relevant financial products will have to pay a minimum levy of $1,500 plus $907 per adviser, while licensees who provide general advice only will fork out a flat levy of $828.
With the federal budget set to be announced tomorrow, Mr Drum believes any hint that the government will relook into the funding model will be much awaited.
“We know there’s been an announcement from the government for extra funding for ASIC but I believe that is for compliance activities rather than changing their funding model,” said Mr Drum.
“We’ll be disappointed if they haven’t actually gone back and reviewed that with a view to ameliorating those costs on those in public practice because the long-term implications of the current model are less competition, market concentration, and less availability of services to consumers or service requirers and that’s not a good thing.”
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