Monday 25 July 2016
The Government set the FMA’s budget when we were established in 2011, but with the introduction of the Financial Markets Conduct Act, and other changes to financial services regulation, our functions and activities have grown and changed significantly.
The FMA’s initial annual appropriation* (funding) of $26.184m, plus up to $2m for litigation funding, is made up of Crown funding and industry levies. We also recover some of our costs through the fees we charge for services such as licensing.
We have been working with the Ministry of Business, Innovation & Employment (MBIE) to review and assess options for our funding. MBIE has now published a consultation paper that includes proposals for the amount of our funding; and what proportions of our funding are paid by the financial services industry and taxpayers. The paper also includes reviews of the XRB levy and Companies Office fees.
The proposal for the FMA is for annual funding of up to $38.6m (including fees and the $2m litigation fund). Two lower funding options are included in the paper, but we believe the enhanced case proposal in the paper would enable us to operate as a credible, risk-based and intelligence-led regulator. It would also enable us to better support growth and integrity in our capital markets and informed investor participation in them.
The paper also seeks feedback on how the FMA’s funding is split between industry levies and taxpayer funds. The Government initially decided that industry levies would provide 61 per cent ($16.41m) of the FMA’s current annual appropriation; the government proposal is for an increase of up to 70 per cent ($27m) for the enhanced case funding option.
If you have an interest and would like to share your views on how we are funded, we encourage you to read the consultation paper and provide your feedback.
Feedback from the individuals and businesses we regulate, and from the New Zealand public, will ultimately help shape our future.
Submissions close Monday 22 August 2016.
* Appropriations provide a Minister with the authority from Parliament to spend public money or incur expenses or liabilities on behalf of the Crown.
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