Peter Costello

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ASIC Receives Additional Funding

NO.025

ASIC RECEIVES ADDITIONAL FUNDING

The Treasurer announced that one of the measures in tonight's Budget is a decision to provide the Australian Securities and Investments Commission (ASIC) with additional funding to enable it to maintain its enforcement capability and for ongoing work in implementing and administering the Financial Services Reform Act 2001.

The Government is committed to ensuring that ASIC is properly funded to undertake its important regulatory and other functions. A comprehensive review of the price of ASIC's outputs was conducted in 2001-02 for decision in the context of the 2002-03 Budget. As a result of this review, ASIC will be provided with additional funding of $90.8 million over four years.

This funding will help ASIC maintain its enforcement capacity, including in relation to a number of high-profile cases, and improve its ability to preserve and recover assets for the benefit of investors.

The additional funding will also enable ASIC to implement and administer the Financial Services Reform Act 2001 on an ongoing basis, including significantly expanded licensing obligations under the Act. The financial sector reforms have been well received in the financial and investor community. They will improve the regulation of financial products, service providers and markets by introducing a single, harmonised licensing regime and product disclosure framework.

ASIC has also been provided with additional funding of $4.6 million in 2001-02 to cover the costs of its involvement with the HIH Royal Commission. ASIC was separately funded in the 2001-02 Budget ($2.5 million in each of 2001-02 and 2002-03) for the costs of its own investigation of the HIH collapse and any resulting prosecutions.

In addition, certain fees charged by ASIC will be increased to more accurately reflect the costs incurred by ASIC in providing particular services to corporations. The Government will of course honour its election commitment to cap annual fees for proprietary companies at $200 for three years.

Media inquiries: Niki Savva (02) 6277 7340

 

14 May 2002

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