The Government has dismissed Securities Commission boss Jane Diplock's claims that the commission has been starved of the cash it needs to protect investors' interests and maintain confidence in the capital markets.
On Sunday, defending what are widely perceived as the commission's long delays in bringing action against failed finance
companies, Ms Diplock told TVNZ's Q+A programme it was "clear that the commission is under resourced, there's no doubt about that".
"Over the years we've had extra responsibilities placed on the commission, which we welcomed, and each time we've gone to the ministry and they go to the Treasury to ask for funding we've received about half or a third of what we felt we required, and when you accumulate that over a number of years it leads to under resourcing."
Ms Diplock also defended what is often perceived as the commission's timid approach to enforcement on the grounds that applicable legislation limits the scope of its powers.
"We certainly, looking back, could say we needed a better regulatory framework at the time, because the commission did not have the powers, was not empowered to look at the investment through the life of its investment."
However, a spokesman for Commerce Minister Simon Power yesterday said the minister believed "the Securities Commission has enough resources and tools and how it uses those resources and tools is something for them".
"He would point to the events of last week when civil and criminal charges were laid against the directors of two finance companies as evidence that they do have enough resources and tools to do their jobs", the spokesman said.
Mr Power is considering whether regulatory and enforcement functions spread across the Securities Commission, Companies Office and sharemarket operator NZX should be rolled together and handled by a single new "super regulator", an approach he has said he favours.
Prime Minister John Key said yesterday the whole area of financial services regulation "could have been carried out better".
"We need to now work on where we go from here and the Commerce Minister's working on that."
Ms Diplock also said she did not believe existing regulation was good enough to support the Government's plan to develop New Zealand as an international financial services hub.
"If we were to progress that idea, and it's no secret I'm keen on that," Mr Key said yesterday, "then we would obviously ensure that adequate regulation is in place to enable that to happen".
