Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
 Download Current HansardDownload Current Hansard    View Or Save XMLView/Save XML

Previous Fragment    Next Fragment
Monday, 20 August 2018
Page: 7880


Mr ROBERT (Fadden) (17:16): I move:

That this House notes:

(1) notes the appointment of the new Deputy Chair of ASIC, Mr Daniel Crennan QC;

(2) further notes that the Government invested in ASIC to give it the tools it needs to be a tough cop on the beat including:

(a) the introduction of an industry funding model to secure ASIC's funding base;

(b) a new product intervention power to enable ASIC to intervene in the sale of harmful products to retail customers;

(c) legislating to:

(i) remove ASIC employees from the Public Service Act 1999 to enhance ASIC's ability to attract and retain the best staff, and

(ii) include competition considerations within ASIC's mandate;

(3) notes Mr Crennan's appointment builds on the reforms to strengthen criminal and civil penalties for corporate misconduct; and

(4) further notes that this appointment boosts the powers of ASIC to protect Australian consumers from corporate and financial misconduct.

ASIC has a new deputy chair, Mr Daniel Crennan QC, appointed by government. He's a highly regarded Queen's Counsel. He has extensive experience in handling relevant cases that relate to ASIC's responsibility, and he will be working with ASIC to further the government's agenda in that part of the regulatory environment.

This motion today before the Chamber is to further note that there is an industry funding model to secure ASIC's funding base; that there are new product intervention powers; that we are legislating to remove ASIC's employees from the Public Service Act to enhance its capacity to attract the best staff; and that we are legislating to include competition considerations within ASIC's mandate. This motion further moves to note that the reforms strengthen criminal and civil penalties for corporate misconduct and notes the boosting of powers for ASIC to protect Australian consumers from corporate and financial misconduct. These are outstanding initiatives and further strengthen the regulator.

Industry funding for ASIC ensures that the costs of regulation are borne by those that have created the need for it. It incentivises compliance. The introduction of the ASIC funding model or industry funding model was a key recommendation of the Financial System Inquiry, and it's a critical component of the government's reforms to strengthen ASIC and better protect Australians.

The government is also moving forward with progressing important reforms to ensure that financial products are targeted and sold to the right customers. The days of product sellers deciding what products they want and squeezing all customers into the same size are coming to an end. We've just concluded a second round of consultation on draft legislation for design and distribution obligations, and product intervention power. These will ensure that financial products are targeted and sold to the right consumers and, where they're inappropriately targeted or sold, ASIC will be empowered to intervene in the distribution of the product to prevent harm to consumers. I've recently met with the Australian Banking Association to discuss the issues of design and distribution obligations and the product intervention power, and I note some of their legitimate concerns regarding inclusions and exclusions, especially to deal with bank accounts.

There's also legislation to remove ASIC from the Public Service Act to enhance it and give it the opportunity to hire the very best staff. We do this right now in some areas of defence and in areas of science. ASIC needs to be able to hire the very best it can get if we wish our regulator to be able to prosecute to the very best levels, as we want it to do. The bottom line is that it's competing in a market for skills, knowledge and experience, and we need to let the regulator compete in the market. I'm particularly pleased about the fact that Mr Crennan's appointment builds on the reform to strengthen civil and criminal penalties. We're strengthening the penalties to protect Australian consumers from not only corporate and financial misconduct but misadventure. These new penalties will ensure that those who do the wrong thing will be punished. It is that simple.

These are some of the most significant reforms to maximise civil penalties that we've seen in 20 years. They are designed to be strong and they are designed as a deterrent, to send a message, to bring them into line with leading international jurisdictions and to ensure that penalties are not only credible but a strong deterrent. In terms of harmonising: penalties for individuals will be 10 years imprisonment or the larger of $945,000 or three times the benefits and for corporations the larger of $9.45 million or three times the benefits or 10 per cent of annual turnover. This is tough. We will expand the range of contraventions subject to civil penalties and also increase the maximum penalty amounts that can be imposed by the courts. We've responded to ASIC's need for funding with an additional $70.1 million over the next two years.

The bottom line is that this package of measures is designed to resource ASIC to the level it needs to be resourced, to accelerate and expand its enforcement activities and to introduce strong new supervisory approaches. It will enable ASIC to be a more agile regulator, which is what we want. It will be a tough cop on the beat, but a cop that can move quickly as the beat changes. I commend the motion to the House.

The DEPUTY SPEAKER ( Mr Howarth ): Would someone like to second the motion?

Mr Irons: I second the motion and reserve my right to speak.