Mulino urged to not drag feet on CSLR
The message to the Assistant Treasurer and Minister for Financial Services, Daniel Mulino, from the broad financial services community – he cannot afford to drag his feet on fixing the funding mechanism of the Compensation Scheme of Last Resort (CSLR).
In the wash-up of Mulino’s Wednesday announcement of the special levy to fund the CSLR sub-sector cost over-run and the following roundtable participants expressed concern that progress in addressing the core issues needed to be prompt and obvious.
Financial Advice Association of Australia (FAAA) chief executive, Sarah Abood used a member webinar to describe the current CSLR cost setting as an existential threat to the profession, while the Finance Industry Council of Australia (FICA) urged Mulino to take the necessary tough decisions.
The FAAA has estimated the special levy will cost financial advisers an additional $700 each, bringing the total cost of the CSLR levy to $2000.
“Consulting on reform options to ensure the CSLR is fair and sustainable in 2026 must be progressed as a priority, ahead of any discussions on managing the 2027 excess,” FICA said.
FICA brings together the leading financial services industry associations in Australia – Australian Banking Association (ABA), Australian Finance Industry Association (AFIA), Australian Financial Markets Association (AFMA), Australian Investment Council (AIC), Australian Securitisation Forum (ASF), Council of Australian Life Insurers (CALI), Customer Owned Banking Association (COBA), Financial Services Council (FSC), and the Insurance Council of Australia (ICA).
At the same time, the Association of Independently Owned Financial Professionals (AIOFP) emerged form a meeting with Mulino satisfied of the possibility of the CSLR legislation being amended to include all participants including Managed Investment Schemes (MISs).
The FICA response to the minister’s approach said he had made tough decisions around the special levy formula but went on to say that “certain design elements of the Scheme have created excessive costs that are flowing through to all customers of financial services, and these costs are expected to grow”.
“The FY26 excess levy has been confirmed to be $47.3 million, and early FY27 estimates suggest this will grow to at least $137.5 million.
“Ongoing ad hoc levies to support a structurally flawed scheme send the wrong message and will simply add costs for all consumers,” the FICA statement said.
The FAAA’s Abood reinforced to members that the CSLR funding mechanism is structurally flawed and that while the organisation is supportive of the minister’s intention to review the professional indemnity (PI) insurance regime, “we cannot rely on PI to resolve these matters”.
In the meantime, the industry funds backed Super Members Council has joined with the Association of Superannuation Funds of Australia (ASFA) in arguing that superannuation funds should not have been enjoined in funding the special levy.
Scum bag Jones pulled Govts funding of 1st year CSLR out.
Scum bag Jones exempted MIS and failed to deliver a promised MIS review.
ASIC totally failed Dixon’s MIS fiasco and illegal Phoenixing.
Govt & Jane Hume bury Dixon’s Enquiry so nothing is learnt or fixed.
Seems ASIC failed again with Shield and First Guardian.
The Canberra Politicians & Bureaucrats contribute NOTHING $$$ for so many Failures. Zero accountability,
What a total Sh#t show the Canberra swamp is.
Just remind us again how much money a super trustee spent on their 40th birthday party using member funds?
What about fines that have been paid by to cover their super trustee ASIC fines?
Any consideration to the lower income Australians footing those expenses?
Crickets….
Isn’t it funny now they are being asked to support the CSLR they suddenly care about their members equity and want to talk about moral hazard?
This needs to be called out.
If CSLR is the ‘last resort’ please tell us ASIC what measures have been taken before you hit innocent advisers with yet another Labour Party tax by another name?
Please we would love to know, and have a right to know what other things did you do as the first resort and the 2nd and third options before you used your last resort scheme???