Australia's Department of the Treasury has proposed the first application of the Compensation Scheme of Last Resort special levy waterfall framework to cover a AUD 170.262 million shortfall for 2026-27. The allocation would impose AUD 10 million on personal financial advice licensees in addition to their AUD 20 million annual levy, AUD 40 million on responsible entities of managed investment schemes and the remaining AUD 120.262 million across 21 retail-facing financial services subsectors using metrics based on Australian Securities and Investments Commission regulatory effort. Under the proposed methodology, a subsector is connected to losses when its product, service or regulated activity formed a substantive part of the pathway to consumer harm. Routine or administrative involvement would not qualify, and a connection finding would not establish misconduct or legal liability. Treasury identified responsible entities as connected to losses involving Dixon Advisory and the Shield and First Guardian Master Funds, supporting their proposed Tier 2 allocation. The allocations and connection assessments are preliminary and have not received government approval. Treasury is seeking evidence on whether the prescribed metrics create material adverse outcomes within subsectors and whether the proposed amounts threaten subsector viability or broader financial stability before the minister makes a final determination.
2026-09-21Department of Treasury (Australia)
Australia's Department of the Treasury consults on proposed allocation of AUD 170.262 million CSLR special levy
Australia's Department of the Treasury has proposed allocating a AUD 170.262 million Compensation Scheme of Last Resort special levy across financial advice, responsible entities of managed investment schemes and 21 other retail-facing subsectors. The consultation covers the methodology for linking subsectors to underlying losses and the potential viability effects of the allocations.