Industry powerbrokers have launched an investigation into the cost of regulating the financial services industry.
The Finance Industry Council of Australia’s (FICA) regulation working group has developed a checklist to analyse the costs and benefits of financial services regulation, board member Kerrie Kelly said at ASIC’s annual conference in Sydney yesterday.
“The Australian financial services industry is concerned and is being proactive so that it can guide and respond to Government on this issue,” Insurance Council of Australia chief executive Kelly said.
Kelly said industry is concerned that proposed legislative changes affecting financial services are being developed by different levels of government.
“This is a significant problem that is looming,” she said.
Kelly said the financial services industry is looking at a template of 11 matters relating to cost. These include monitoring, enforcement, the cost to consumers, procedures, implementation and education and training. She said the insurance industry is looking into six issues to do with the benefits of regulation.
The checklist will form a basis for industry discussions with governments and regulators and provide a template to monitor and track regulator costs and benefits to provide input to government consultations.
FICA is comprised of representatives from the Australian Bankers’ Association, Australian Finance Conference, Australian Financial Markets Association (AFMA), Insurance Council of Australia and the Investment and Financial Services Association (IFSA).
IFSA chief executive and FICA chairman Richard Gilbert said the finance sector needs to conduct more research than it is currently doing and the working group will provide important information for the industry.
“There’s no hidden agenda,” Gilbert said. “It will be done in a very careful and cautious way.”
Regulatory change is a battle of vested interests because there are always winners and losers, Commonwealth Bank Chair of Finance Professor Kevin Davis told the ASIC conference.
“Those responsible for regulatory changes should be accountable for rigorous, informed analysis and decision making,” Davis said.
