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Tuesday, 14 October 2008
Page: 8960

Ms JULIE BISHOP (2:36 PM) —My question is to the Treasurer. Why did the Treasurer cut the funding for the prudential regulator APRA by $6 million in the last budget when the global financial crisis was already well underway?

Mr SWAN (Treasurer) —I thank the member for her question. The fact is that we have been strongly supporting APRA. I have been meeting with them more regularly than has ever occurred in the history of this country and since APRA’s creation. We have been very supportive of APRA. I meet with APRA regularly and I also meet with them as part of the Council of Financial Regulators, which includes ASIC, APRA, the Treasury and the Reserve Bank. All of those bodies that receive funding from us have indicated to me that they have sufficient resources to do their job. If they indicated to me that they needed additional resources, then of course they would be forthcoming. Also the member would be aware that APRA has as a source of funding money that it receives effectively on a fee-for-service basis. So, if APRA required further resources, they would of course receive them.

For these questions to come from those opposite is just a little bit rich. Those opposite sat on the recommendations of the HIH royal commission. There was one that they did not implement. It was the recommendation for a financial claims scheme. They did not touch it. They did not touch the recommendation for a financial claims scheme, so when we came to government we did meet with all of our regulators to discuss their resourcing needs and also, in early February, to discuss the then seen implications of what was going on in international financial markets.

One of the strong recommendations to us at that stage from those regulators was to proceed with a financial claims scheme. We therefore put that process in motion and made an announcement about that in this parliament—something those opposite could not see their way to doing for a number of years. We have taken all of these issues very seriously. We think that there is a way to go yet when it comes to the problems in financial markets and we will not hesitate to take any further action to strengthen either our regulators or our financial system. But at all times through this year we have worked very closely with our financial regulators to ensure that the country gets the best possible outcome.