Cabinet approves funding for FMA

Commerce Minister Simon Power today announced Cabinet approval for the operating budget for the Financial Markets Authority, which begins operation on 1 May.

The budget for 2011/12 will be $24 million, increasing to $28 million in 2013/14 to reflect the emphasis on market intelligence, investigation and enforcement, and some additional transition costs.

The budget for 2014/15 and beyond will be about $26 million – an increase of around 44 per cent over the $18 million budget for the current regulators.

Mr Power said the FMA needs to be adequately resourced and funded to carry out its functions effectively.

“This budget shows that the Government is committed to ensuring the FMA has the right tools to keep our capital markets working for mum and dad investors.

"With this level of funding it can focus on proactively monitoring and enforcing regulation of our financial markets.”

The approved funding will provide additional investment in the areas of market intelligence, investigation, and enforcement.

The funding will be a combination of Crown funding, to reflect broader public good, and third-party funding, where services are provided to specific market participants for their individual or group benefit. Third-party funding will be sourced from fees and levies paid under the new legislation.

Mr Power said he intends to publish a discussion document shortly seeking public comment on the proposed fees and levies.

The discussion document will also contain fees and levy proposals for the Companies Office, the Insolvency and Trustee Service, and the External Reporting Board. This will provide a clearer picture of government fee and levy changes in the financial sector.