Australia walks a fine regulatory line despite emerging from the global financial crisis in better shape than most, according to Federal Treasury officer Vicki Wilkinson.

Speaking at the Insurance Council of Australia’s annual Regulatory Update conference in Sydney last week, Ms Wilkinson – Treasury’s Principal Adviser, Corporations & Financial Services Division, Markets Group – says Australia can ill-afford to rest on its laurels.

“On the one hand, from a policymaker’s point of view we certainly are promoting the strength of our system and the benefits of it in the international forums,” she said.

“But on the other hand we’ve got to be careful that we suddenly don’t get too far out of line and create a perception that Australia is not ‘going along with [global regulatory change]’ and therefore we are riskier.”

She says the Federal Government has an “acute awareness” of the dangers of going too far in terms of regulation.

QBE Australia Chief Risk Officer George Thwaites told the conference the massive wave of fundamental global regulatory change anticipated at the peak of the financial crisis has not happened.

“The key is that, in fact, everyone has withdrawn into their local shells,” he said.

Among the evidence of this is resistance from the US National Association of Insurance Commissioners fighting the push for a federally based insurance regulatory system.

Ian Enright, a partner at law firm Henry Davis York, says changes in global regulation are unlikely to come from organisations like the G20 because they are simply too new.

“It seems to me sovereign issues and sovereign competitiveness in the markets has really taken over from that first flush of ‘we must all work together’,” Mr Enright said.

He says the International Association of Insurance Supervisors will gradually gain more sway across the globe, but it will take up to 20 years to achieve.