Little CSLR levy relief foreshadowed in Budget papers

The funding arrangements for the Compensation Scheme of Last Resort (CSLR) remain subject to a Treasury post-implementation review, but the Budget papers make clear that financial advisers should expect little respite.

The Portfolio Budget Statements for 2025-26 reveal budgeted income from the CSLR levy jumping from $24.277 million in 2024-25 to $27.860 million and then remaining at that level across to the forward estimates out to 2028-29.

ASIC’s traditional “supervisory cost levies” are also forecast to rise from $319,255 million in the current financial year to $334.166 million in 2025-26 rising to $337.496 million in 2026-27 before decreasing over the subsequent out years.

The Government announced a post-implementation review of the CSLR in January with stakeholder submissions closing on 28 February.

The terms of reference for the review said it would consider:

How the CSLR is delivering on its intended objectives;

• How the CSLR funding model is formulated, including its potential impacts on businesses who fund the industry levy;
• How the powers of the CSLR Operator interact with delivery of the scheme; and
• The current scope of the CSLR and any related matters. The review should have regard of other current and recent reviews and inquiries as relevant.

The Government announced the review amid industry uproar over the manner in which the cost of the CSLR levy was impacting advisers, rising dramatically from $1,186 per year to $4,516 – an increase of 250%.

Stakeholder submissions to the Treasury review have almost without exception called for changes to the levy regime, arguing that the current methodology makes it unsustainable.