Disquiet over Task Force delay

The government’s decision to hold off implementing changes from the Task Force on Financial Intermediaries is causing disquiet in the industry.

Friday, July 29th 2005, 6:34AM

by Rob Hosking

The government yesterday surprised the industry by quietly announcing that any measures stemming from the Task Force’s work won’t go to Cabinet until late next year, with implementation not taking place until 2008.

One Task Force member, Alliance Capital chief executive Ross Kent, says the long time frame was not expected.

“Substantial delay would be not what the industry is wanting.”

The reason Ministry for Economic Development officials have given for the delay is the review of regulation of the non-banking financial sector, announced as the Task Force was nearing the end of its work.

However Kent says he understands that review is focussed mostly on the provider side of the industry, whereas the Task Force was more concerned with the consumer and distribution side.

The Task Force options paper released in April set out a fairly clear dividing line between the two, he says. “Speaking personally, I would have thought they could proceed on some measures.”

And the president of the Financial Planners and Insurance Advisers Association, George Elkington, also expressed surprise at the long lead time. “I certainly didn’t expect it to be rapid but I did expect it to be quicker than that.”

The FPIA – which has long advocated a mix of self regulation backed by government agencies will, in the interim press, on with its plans on the self regulation side, he says.

Meanwhile release of the Task Force’s final report, if not its implementation, is going to be ahead of schedule. The final work goes to Commerce Minister Pete Hodgson today, and is planned for release sometime next week.

Rob Hosking is a Wellington-based freelance writer specialising in political, economic and IT related issues.

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