The Australian Securities and Investments Commission (ASIC) believes budget cuts imposed by the Federal Government will affect the service it can deliver.

Chairman Greg Medcraft says in the regulator’s annual report that ASIC faces cuts of $120 million, plus an increased efficiency dividend of $47 million, over four years.

This means an operating budget reduction of $44 million, or 12%, this financial year, leading to 209 job cuts.

ASIC has anticipated the effects and will “embrace the opportunities and challenges” of the next year, Mr Medcraft says.

However, “one trade-off is that our proactive surveillance will substantially reduce”.

The regulator will continue to push for a user-pays funding model.

“Such a model is not about increasing ASIC’s budget but about providing the economic incentives to drive the Government’s desired regulatory outcomes for the financial system,” Mr Medcraft says.

Income from fines last financial year totalled $89.48 million, up almost 5% on the previous year, while income from fees grew 6.5% to $673.36 million.

Court cases completed increased to 149 from 144, while 14 people were jailed, up from eight the previous year. The number of people or companies banned from the financial services industry increased to 57 from 50.