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NIBA urges ‘fair’ levy allocation for ASIC funding

The National Insurance Brokers Association (NIBA) wants levies to be allocated fairly when the Australian Securities and Investments Commission (ASIC) moves to a new funding model on July 1.

Last April the Government announced a $127 million reform package for ASIC, to be primarily financed by the banks, to pay for the cost of its regulatory activities.

“The key focus for NIBA in the proposed regime, given the limited regulatory issues affecting its members when compared with other sectors, is on achieving a fair allocation of levies to reflect this,” association CEO Dallas Booth says in a submission.

NIBA is also focused on securing a “a cost and time-effective reporting regime to assist ASIC in allocating levies, and to assist members in meeting their reporting obligations”.

NIBA and the Insurance Council of Australia have voiced concerns that the insurance industry will end up paying more than its fair share, potentially subsidising more troubled industries.

The insurance sector takes up about 2% of ASIC’s budget for regulatory work, according to Treasury figures.

“NIBA is pleased to see… that it is not within the objectives to recover regulatory costs from entities that did not drive the cost of that regulation,” Mr Booth says.

“The reality does, however, appear to be that ASIC, by allocating resources to certain areas at its discretion, can then justify the allocation of levies to that area even where the allocation of resources to that area may not have been justified.

“We would like to discuss how the Government believes this risk will be managed.”

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