The Minister for Financial Services & Regulation, Joe Hockey, today announced the 2000-01 financial sector levies.
The levies cover the supervisory costs of prudentially regulated financial institutions, which include the operational costs of the Australian Prudential Regulation Authority (APRA) and the consumer protection functions of the Australian Securities and Investments Commission (ASIC) and the Australian Taxation Office (ATO).
The 2000-01 levies have been determined so that revenue collected from each industry will cover the costs of supervising that industry and to achieve the outcomes of the recent financial sector levy review.
Total levy revenue required has declined markedly from $66.6 million in 1999-00 to $61 million in 2000-01.
The levy rates and the amounts applicable to the relevant industry sectors for 2000-01 are set out in the table below.
Industry |
Percentage of assets |
Minimum levy |
Maximum levy |
| Superannuation funds 2000-01 |
0.02% |
$300 |
$46,000 |
| Retirement savings account providers 2000-01 |
0.02% |
$5,000 |
$18,500 |
| Life insurers 2000-01 |
0.02% |
$500 |
$280,000 |
| General insurers 2000-01 |
0.02% |
$5,000 |
$100,000 |
| Authorised deposit-taking institutions 2000-01 |
0.012% |
$500 |
$1,000,000 |
| Foreign bank branches 2000-01 |
0.006% |
$500 |
$500,000 |
| Non-operating holding companies 2000-01 |
Flat rate charge of $10,000 |
"The reduced levy revenue required is evidence that the regulator have met cost efficiencies and that the cost of supervision is declining. This cost saving is being directly passed on to financial sector entities," the Minister said.
In 2000-01, the superannuation sector will receive a reduced levy rate of 0.02 per cent of assets which is half that of the rate for 1999-00. The reduced levy rate is the result of excess levy revenue collections in this sector in previous periods and the achievement of significant savings in infrastructure costs.
The maximum levy payable by superannuation entities in 2000-01 increases to $46,000 from $41,000 in 1999-00. This increase is directly attributable to the increase in funding for the Superannuation Complaints Tribunal (SCT) which plays an important part in the market integrity and consumer protection functions of the super industry.
The authorised deposit-taking institution sector receives a reduced levy rate of 0.012 per cent of assets in 2000-01 down from 0.013 per cent of assets in 1999-00. This is a direct result of excess levy revenue collection in this sector from previous periods.
Within the authorised deposit-taking institutions sector, foreign bank branches receive a concessional levy rate of 0.006 per cent of assets along with a reduced maximum levy payable of $500,000. The concession provided to foreign bank branches reflects their less intensive supervision in Australia because of the additional supervision provided by their home country supervisor and their inability to accept retail deposits.
General insurers pay a new maximum levy amount of $100,000 in 2000-01 up from $75,000 in 1999-00. The increase results from increased supervisory work being undertaken in the sector.
Financial sector levy review outcomes
The financial sector levy review was established with the aim of ensuring the current levy arrangements provided an effective, equitable and durable funding mechanism for the supervision of prudentially regulated institutions.
Industry groups have been widely consulted during the levy review and in the 2000-01 levy parameter setting process. Industry feedback was essential and contributed significantly to the outcomes.
The main outcomes from the review are:
- to continue imposing levies on a sectoral basis;
- providing the ability to rebate excess levies collected back to industry;
- to recognise the lower level of demand placed on Australias regulators by foreign bank branches; and
- regulators are to provide more detailed specific activity cost information to assist with the levy setting process.