The Federal Government has released a discussion paper that seeks to minimise both duplications and costs within Australia’s system of prudential regulation.
The Treasury discussion paper, released by the Assistant Treasurer, Peter Dutton, on Monday, acknowledges the cost to superannuation funds of the current breach reporting regime and says that the cost of breach reporting may be unnecessarily high and that this might be owed to “inconsistent and excessive” reporting.
The discussion paper proposes a materiality test that would take account of factors such as previous similar breaches and the degree to which the breach indicates that the regulated entity’s compliance systems are inadequate.
The discussion paper also examines the impact of overlapping reporting requirements on breach reporting and suggests a formula for eliminating multiple reporting of the same breach.
The discussion paper also seeks comment on whether there is scope to further streamline the responsible officer and responsible person legislation to ensure that only the relevant people are captured.
It also calls into question a “blurring of the line of accountability” for prudential decisions made by the Australian Prudential Regulation Authority (APRA), with the regulator’s decisions subject to judicial review, merits review and Parliamentary review.
Instead, Treasury proposes the removal of ministerial consent from APRA administrative decisions where wider policy interests are not involved.
The paper also proposes a re-alignment of APRA’s enforcement powers to ensure enforcement action is “proportionate to the problem which it is addressing”.
