Lotu-Iiga Peseta Sam: Estimates Debate — In Committee 
Lotu-Iiga Peseta Sam: Estimates Debate — In Committee 
[Advance Copy - Subject to minor change before inclusion in Bound Volume.] 
PESETA SAM LOTU-IIGA (National—Maungakiekie) 
: 
 It is my privilege to speak on the Vote Commerce estimates for this 2011 year. The Vote Commerce estimates were increased by 12 percent this financial year and one of the key reasons for that increase as my colleague Jonathan Young pointed out is the establishment of the Financial Markets Authority. 
That authority will in its first year have tabbed for it $31.7 million for its establishment and also its functioning. It replaces the Securities Commission. We are informed that it will provide for a more active more well-resourced and more streamlined regulator of financial markets. The purpose of it is again as Mr Young pointed out to improve investors’ confidence and participation in our capital markets particularly after the recent spate of finance company failures that occurred in the last 3 to 5 years. 
One of the key provisions of the Financial Markets Authority’s statute which we put in place was to give it the right of action on behalf of either a company or an individual to take on rogue companies particularly finance companies. That will provide for those people who cannot take on the action themselves and for the Financial Markets Authority to at least enforce that statute. It will create a new market intelligence unit which issuers will be able to consult as they develop new products in order to avoid the need for corrective measures later on in the process. That is about working with the industry to provide for more effective and more efficient markets. We have seen recently with the spate of low-ball offers that the Financial Markets Authority will be able to take on such inequitable low-ball offers provided by those people who prey on vulnerable investors. So we can see that the Financial Markets Authority will be an all-powerful regulator unlike the Securities Commission which was its predecessor. 
The commerce portfolio has been a busy one under the current Minister of Commerce. He departs Parliament in the next few months so we salute his work in the portfolio. The Commerce Committee has been a rather industrious committee. We have pushed through legislation on financial service providers and financial advisers auditors and insolvency practitioners and securities trustees. We have also dealt with patents and copyright law which was quite difficult. But the mother of all financial markets legislation is still to be done and that is the reform of the Securities Act which is well overdue. We expect a draft exposure paper to be out in the next few weeks. 
In terms of the financial advisers legislation the financial advisers I speak to particularly in my own electorate of Maungakiekie say it adds compliance and it adds regulation. But compliance and regulation also allow for the industry to be more credible and for the people who practise financial advisory services in the markets to have more integrity. The practitioners have said that that is OK. To date to 1 July 1300 authorised financial advisers have been registered with 700 still to complete that process. 
I will just touch on another piece of legislation that the Minister has signalled should be reformed which is in the area of moneylenders. The Minister has signalled there will be a financial summit next week on 11 August where stakeholders in the whole moneylender industry will come together to share ideas and to exchange their thoughts on the way forward in terms of regulation. We should see some response on that from the Minister and from this Government in the coming months. It is an area I encounter every day in my electorate office and it is one that needs reform. I see people who have been affected by loan sharks or moneylenders.