APRA chairman in a planned address to the senate economics legislation committee has said that APRA was ready to take on new responsibilities and adopt a broader focus in their activities.
Wayne Byres was due to address the committee yesterday, but the hearings did not proceed due to Prime Minister Scott Morrison calling the federal election hours beforehand.
In his prepared statement, Mr Byres told the committee where the $150 million from the 2019 budget was being spent as well as the additional $60 million as announced last year.
“Taken together, this additional funding will support an increase of roughly 100 additional permanent staff, a meaningful increase relative to our long-run operating level of around 600,” he said.
The money would upgrade the authority’s supervisory capabilities in three main ways, said Mr Byres.
First, by enhancing the supervisory framework and approach for governance culture and remuneration that apply to all APRA-regulated entities. Second, by extending BEAR to all regulated entities including insurers and super funds and lastly by boosting the authority’s broader supervision.
“We will also be using our additional resources to implement our new enforcement approach, which we plan to make public later this month.
“Taking into account developments such as the BEAR regime, the royal commission, the learnings from the CBA Inquiry – and the fact we have had new powers given to us – we plan to set out a new approach to enforcement that will see us utilising our enforcement tools more quickly in future, particularly for uncooperative institutions,” said Mr Byres.
My Byres reiterated that the Australian financial system was fundamentally sound but it could not be taken for granted.
“Pursuing short-term financial gain at the expense of doing the right thing inevitably comes at a steep cost in reputational damage and lost revenue, and we have challenged the industry to show greater leadership in responding to concerns about products or services, rather than being dragged into action by regulators or governments,” he said.
In 2019 APRA would commence a major drive towards increased transparency in the superannuation industry as part of a push to lift standards said Mr Byres.
Mr Byres also noted that the recent passage of the Treasury Laws Amendment would give APRA more powers to force trustees to lift their game.
“When last here, I described the bill as a ‘game changer’ for us, and we are preparing to use the powers that Parliament has granted us to increase the pressure on underperforming trustees to lift their game or exit the industry,” he said.
APRA was also working hard to enact all of the necessary policy changes off the back of the royal commission said Mr Bryes.
“With respect to the 10 recommendations which fall within APRA’s responsibilities, we released the first proposed policy changes – in relation to land valuations, particularly for agricultural land (Recommendation 1.12) – a couple of weeks ago. Other actions remain on track against the action plan for each recommendation that we published in the week after the final report was released,” he said.
The senate committee will not be sitting while the government is in caretaker mode and will resume after the federal election.
Eliot Hastie is a journalist at Momentum Media, writing primarily for its wealth and financial services platforms.
Eliot joined the team in 2018 having previously written on Real Estate Business with Momentum Media as well.
Eliot graduated from the University of Westminster, UK with a Bachelor of Arts (Journalism).
You can email him on: [email protected]
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