Privatisation of ASIC corporate registry on the table
Tuesday, April 15, 2014/
The federal government is considering privatising the Australian Securities and Investments Commission corporate register, providing a much needed cash injection for the government.
The speculation comes after ASIC chairman Greg Medcraft made comments to the economics references committee in February that the corporate register was “frankly, a technology business”.
“It is not really a regulatory business,” Medcraft says. “That business has huge opportunities in terms of economies of scale. The Siebel system we have has, currently, six million names on it.”
Medcraft says there could be “huge benefits” in separating the registry business and “merging it with other government registries to leverage the economies of scale from the Siebel management system”.
SmartCompany contacted ASIC for comment, but the regulator said it wasn’t commenting further. SmartCompany also contacted Assistant Treasurer Mathias Cormann, but received no response prior to publication.
A spokesperson for the Attorney-General’s department told SmartCompany ASIC’s corporate register “is a matter for ASIC”.
According to The Australian, the ASIC registry generates more than $625 million in revenue and has annual costs of around $140 million.
Medcraft says the move would also have benefits from a consumer perspective.
“You end up with a one-stop shop for financial services and even other registry thing you go to. If you want to update, you want to go to one place et cetera… I think the registry is one that probably would be better moved out, aggregated with other registries to provide a one-stop shop for Australians,” he says.
“And you have to think about the massive opportunity for extracting revenue from the metadata that actually comes from that.”
The Coalition has already announced its plans to privatise Medibank Private through an Initial Public Offering, with the health insurance business expected to be worth around $4 billion.
The privatisation talks come as Federal Treasurer Joe Hockey has been preparing Australian’s for a tough May budget.
Hockey has flagged the possibility of increasing the pension age and told ABC TV his generation may have to work for an extra three years.
“We need to redesign our systems to manage that fact,” he says.
In March the government also claimed it had inherited a spending blow-out in the final year of its four-year budget, with the Labor government allegedly pushing huge increases in spending on foreign aid, defence and health into the fifth year of its budget last year.
Hockey said in Parliament Labor had concealed a “massive tsunami” of planned spending.
Speaking in Washington last week the Treasurer also said with the current budget deficit and below trend growth, there could be budget deficits for the next decade.
“We are now grappling with growth stubbornly below trend as our economy rapidly transitions from the end of the resources investment boom, with rising unemployment and a deteriorating budget position,” he says.
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