ASIC annual report shows Budget cuts starting to bite

Bernard Kellerman
The Australian Securities and Investments Commission has tabled its annual report for the year ended 30 June 2014. While the agency has put on a brave front in terms of showing what it has been doing, and setting out its objectives, there is no avoiding the stark fact that the budget for "Australia's frontline and integrated financial services and markets regulator" has been reduced by around A$120 million over four years.

This is in addition to an increased efficiency dividend of around $47 million over four years, and other "savings measures".

"In 2014-15, our operating budget will reduce by $44 million or around 12 per cent. Our average staffing levels will fall by 209," ASIC explained.

"We will continue to adjust our resource allocation to reflect the available funding, and our statutory role. One trade‑off is that our proactive surveillance will substantially reduce."

The performance of ASIC was referred to the Senate Economics Reference Committee.

The Committee released its report on the Inquiry on 26 June 2014. "We had a core team of seven staff dedicated to responding to the Inquiry. The team consulted extensively across ASIC..." the Commission's annual report noted.

At a top-line view, ASIC received $347 million in 2013-14, compared with $350 million in 2012-13. In addition ASIC received $5 million in other revenue, compared with $17 million in 2012-13, predominantly as a result of the reduction in the recovery of costs from the Companies Unclaimed Monies Special Account, which was abolished in December 2012.

ASIC raised $763 million for the Commonwealth in fees and charges, an increase of six per cent from 2012-13. The increase in revenue was courtesy of an increase in the corporate registry (new companies), an increase in Business Names revenue and fee indexation of 2.5 per cent.