The Government may have resolved the question of how the Australian Securities and Investments Commission is to be funded, with its announcement last week that it will move to a user-pays model for the regulator, but it is still a long way off resolving exactly what that model will look like.Industry submissions to Treasury consultation on ASIC funding last year showed general support for the user-pays principle but widespread disagreement about how costs should be shared.Last week the Treasurer had no comment to make about the outcome of the Treasury consultation. His only commitment was to have more consultation. "The government will consult extensively with industry to refine and settle this funding model," he said.The Government's plan is that from 2017/18, ASIC's costs will be recovered from all industry sectors ASIC regulates.The Treasury consultation paper, issued last August, picked up on a recommendation of the Financial System Inquiry that the Government should adopt an industry funding model for ASIC. This would provide more funding certainty and enhance transparency. The Government has proposed that ASIC would continue to be funded from the Australian Government Budget, with a much larger share of its budget offset by charging industry levies and fees.The consultation paper pointed out that UK Financial Conduct Authority, The US Securities and Exchange Commission and Germany's Federal Financial Supervisory Authority are funded this way.In 2014/15 the Government provided ASIC with around A$260 million. Under an industry funding model the Government would seek to recover the costs of these activities, less the costs of activities that the Government determines should not be recovered.Excluded activities would include "government activities", such as general policy development, ministerial support and the administration of the unclaimed money program.The Australian Bankers Association submission in response to the consultation paper said levies on business should be consistent with the level and intensity of ASIC's regulatory activity and risk. "There is concern that some elements of the proposals are more based on capacity to pay. For example, the proposal for annual supervisory levies to be determined on the basis of market capitalisation and for levies on credit licensees to be based on credit volume," the ABA said. The Financial Planning Association of Australia said the proposed funding model created a risk to competition.The FPA said: "The proposed ASIC funding model will have a significant impact on all advice businesses. Our analysis shows that it does not achieve the objective of being equitable across the entire financial services sector. "Small licensee businesses (those with five advisers or less) will end up paying twice as much per adviser than medium and larger licensee businesses."The FPA urged the Government to consider exemptions for small business operators similar to the model used by the anti-money laundering regulator Austrac.The Customer Owned Banking Association said the big banks should pay a greater share. "The levy should be paid by those who are responsible for the scandals. The major banks that have caused the problems for consumers should be paying ASIC's bill."The customer owned model isn't