Regulatory Simplification Priorities for Financial Services
Council of Financial Regulators
By email
Dear Mr Healey,
Regulatory Simplification Priorities for Financial Services
Thank you for the opportunity to contribute to the Council of Financial Regulators’ (Council) approach to regulatory simplification for the financial services sector.
The Finance Industry Council of Australia (FICA) brings together leading financial services industry associations in Australia. We collaborate with the membership of each of our constituent associations to represent the Australian financial services industry in public policy and reform. Our collective aim is to ensure the industry continues to deliver competitive, efficient, and innovative products and services in Australia, guided by five key priorities: financing growth; right-sizing regulation; innovating markets; managing risks; and promoting financial wellbeing.
We support the Council’s work to deliver a roadmap that tracks regulator progress in simplifying regulations for financial services. Australia is renowned for its strong regulatory framework, which creates market stability and protects consumers. Our members are committed to working with regulators to ensure regulation is proportionate and achieves its intended outcomes efficiently, while maintaining good governance and consumer protections.
Law Reform Opportunities
FICA believes the Council should prioritise reviewing disproportionate regulation and consolidating resources, processes, and accountability:
Proportionality: Regulators should review governance and reporting requirements—including remuneration reporting, to ensure administrative effort reflects the market and consumer risk being mitigated. This should include a review of post-Hayne Royal Commission regulatory changes to confirm that intended consumer benefits are being realised.
Consolidation: Financial services legislation, subordinate legislation, and delegated instruments should be reviewed and consolidated to reduce the number of separate touchpoints for entities. Duplicative requirements should be streamlined, and definitions harmonized, where possible. The industry is finding that more important information on regulatory requirements is being distributed via fragmented channels (such as FAQs and consultation papers) and are no longer contained wholistically in the standards themselves. There should be clearer indicators when there are amendments or clarifications, and these should be centrally available (in the standard/ regulatory guide).
The Australian Law Reform Commission’s 2020 Review of the Legislative Framework for Corporations and Financial Services Regulation conducted a thorough analysis on the structure of financial services regulation and should inform this process. Regular review processes should be embedded in regulatory frameworks to ensure ongoing relevance and proportionality.
Streamlining data collections and reporting
FICA has had several discussions with Government and regulators about data and duplicative reporting. Attachment A outlines examples of overlapping data requests and reporting requirements initiated by multiple regulators or by different teams within the same regulator. We have included proposals on how these collections could be improved.
As part of consolidation, the Government should include financial services in its “tell us once” reporting model. APRA, as the statistical entity overseeing the financial services sector, could serve as the central reporting point. This approach could also streamline breach reporting across APRA, ASIC, and the OAIC into a single entity.
An example of duplicative reporting that could be streamlined through a “tell us once” model, includes notifying APRA and ASIC about changes to directors or senior managers. ASIC requires updates on company directors through the company officer holder portal. In addition to this, financial institutions may need to report similar changes under the Financial Accountability Regime (FAR), as well as for their AFSL and credit licence. AFSL and ACL changes for responsible persons are made through the ASIC Regulatory Portal while changes for Accountable Persons under FAR use FAR-specific forms lodged through APRA Connect, which is then shared with ASIC.
We acknowledge that implementing a “tell us once” framework may take time to systemically improve coordination across regulators. However, immediate steps can be taken to improve how data is obtained from the sector and reporting is being carried out. We recommend:
Regulators centralise the management of data requests within a single team within their business. Where this is not currently the structure, multiple teams can initiate requests without internal coordination leading to duplication.
Reporting requirements are reviewed to remove duplication from within the same regulator and across different regulators eg. SDT1 expanded the data APRA collects beyond MySuper products to include all superannuation products and investment options. New data forms have been in place since Sept 2021 but many of the legacy data points are still simultaneously being collected.
Reporting standards should be harmonised across regulators, drawing on international standards where appropriate. An example of varying reporting standards being used for similar information is reporting on executive remuneration, which is reported on via the FAR and APRA.
Regulators should be required to use the Regulatory Initiatives Grid (RIG) as a mechanism to log and monitor ad hoc and regular data collections.
Requiring regulators to review existing regular collections (via the RIG) before issuing ad hoc requests and seek permission from industry participants to use data provided for other purposes.
Requiring regulators to consult with industry on the scope and timelines of data requests before issuing them, ensuring clarity on the purpose and intended use of the data.
Entities value transparency on why data is collected and how it will be used. Regulatory requests often demand highly granular, account-level data across multiple years, with short deadlines and unclear purposes. Sometimes, collected data is never used, leaving entities questioning the value provided for the effort involved. Lack of clarity also prevents entities from leveraging existing processes or advising regulators on better data sources. Greater transparency and realistic timelines would enable a “collect once, use many” approach.
We would value the opportunity to discuss our case studies and priority regulations for review with the Council. If you require further information please contact Brooke Noorbergen, Senior Adviser and Secretariat to FICA at bnoorbergen@insurancecouncil.com.au.
Yours sincerely,
Andrew Hall, FICA Chair & Chief Executive Officer Insurance Council of Australia
Simon Birmingham, Chief Executive Officer, Australian Banking Association
Diane Tate, Chief Executive Officer, Australian Finance Industry Association
Brett Harper, Chief Executive Officer, Australian Financial Markets Association
Navleen Prasad, Chief Executive Officer, Australian Investment Council
Chris Dalton, Chief Executive Officer, Australian Securitisation Forum
Mike Lawrence, Chief Executive Officer, Customer Owned Banking Association
Christine Cupitt, Chief Executive Officer, Council of Australian Life Insurers
Blake Briggs, Chief Executive Officer, Financial Services Council