New Zealand's rag-tag pack of financial market watchdogs is to be replaced with a "super regulator" by early next year as the Government seeks to restore investor confidence battered by the finance company meltdown and global financial crisis.

Commerce Minister Simon Power last night confirmed the Government had decided to proceed with the implementation of an integrated single regulator, one of the recommendations from the Capital Markets Development Taskforce which reported back last year.

Speaking at the finance industry's New Zealand Herald INFINZ Awards last night, Power said the time had come to redesign New Zealand's capital market regulators, "drawing on the lessons from the financial crisis and finance company failures, to ensure that a new-look regulator has the right culture for what we expect of it today".

"This move is at the centre of the Government's drive to restore the confidence of mum and dad investors in our financial markets," he said. "This will be a new body, built from scratch from its component parts, but with a new focus and a new mandate."

The new regulator - which will be called the Financial Markets Authority (FMA) - will incorporate a wide range of existing regulatory powers and functions including those of the Securities Commission and some currently performed by the Companies Office and its National Enforcement Unit. It will also have more direct powers to oversee the New Zealand sharemarket.

Power said the consolidation of functions and powers into the new authority "will ensure a focus on surveillance and enforcement, which will be key to improving confidence".

All of the Securities Commission's staff will be transferred to the FMA but "there will be a restructure and some positions may change".

Where functions are transferred to the FMA from the Ministry of Economic Development and the NZX those staff affected may be offered new positions, Power said.

An establishment board advising on the FMA's design will be established soon and the new regulator's duties will be spelled out in legislation to be passed this year, with a view to having it operational early next year.

Power said the new regulator would be in place before the current review of the Securities Act was completed. It was, he said, too important to wait.

* Will have sole responsibility for enforcing securities, financial reporting and company laws.
* Will regulate and oversee trustees, auditors, directors of financial service providers and financial advisers.
* Sharemarket operator NZX will retain the power to make and enforce its own market rules but they will need to be approved by the FMA which will also have powers to formulate rules.
* The functions of NZX's NZ Markets Disciplinary Tribunal will be transferred to a new statutory rulings panel serviced by the FMA.
* All of the functions of the Government Actuary, including KiwiSaver regulation, will be transferred to the FMA.