The ACCC has welcomed the Productivity Commission’s (the PC) draft report into competition in the Australian Financial System, focussing its opening remarks on the following three issues:
- Competition advocacy and the ACCC’s role in financial services: The PC recommended options for a regulator to advance competition in the Australian financial system and ensure robust consideration of competition in the regulatory decision making processes of an established Council of Financial Regulators. One option is that the ACCC be granted proactive functions to supplement its existing reactive role in the financial system. The ACCC believes it is well placed to utilise its focus on competition in important regulatory decisions of the financial sector.
- The ACCC’s Financial Services Unit (FSU): The ACCC has recently established a Financial Services Unit tasked with undertaking regular inquiries into competition issues in the financial system. Many of the responsibilities proposed by the PC draft report are aligned with the FSU’s mandate.
- Embedding greater transparency in decision-making and commitment to competition: The ACCC is supportive of increasing the transparency in regulatory decision making associated with the financial system.
The draft report was initially released last month as part of the PC’s 12 month enquiry into competition in Australia’s financial system (previously discussed here). Generally, the draft report identified that the current financial system lacks strong price rivalry despite competition and innovation fostering accessibility. The report also noted concern that the institutional responsibility for supporting competition in the financial system is currently too loosely shared across numerous regulators resulting in a lack of real responsibility.
The final report is set to be prepared for Government by 1 July 2018 after further submissions are received and public hearings are held.