International regulators want Canada to adopt a single national securities regulator to strengthen the country's ability to respond nimbly to emerging crises, according to Canada's representative to the International Monetary Fund.
Tom Hockin told a Toronto audience the other countries represented on the IMF's 24-member board of directors have chided him over Canada's inability so far to negotiate the creation of a single national regulator.
"My colleagues at the IMF say, 'why can't you get this done,' and I don't really have a good answer except provincial parochial attitudes," Hockin said.
He said a national commission would "build confidence" internationally in Canada's capital markets and would draw more investors to the country.
It would also assuage international regulators who are concerned about Canada's ability to manage broad systemic risks when market oversight is splintered. The IMF, Hockin said, is not confident Canada can move quickly to deal with emerging problems when policy must be co-ordinated through 13 different provincial and territorial securities commissions.
"They're concerned about nimbleness if a crisis occurs," he said.
Hockin was named as Canada's representative to the IMF in December, 2009. The former Mulroney-era federal cabinet minister became the first Canadian executive director of the IMF to enter the job from outside the federal public service.
Prior to his appointment, he headed a committee that studied financial regulation in Canada. Its report, delivered in January, 2009, became the basis for the federal government's current plan to create a new national securities regulator. Hockin strongly endorsed the creation of a single securities regulator in Canada, saying the current system of 13 provincial and territorial regulators is inefficient and has led to weaker policy development and enforcement.
Hockin's comments in Toronto come less than 10 days after Bryan Davies, the vice-chairman of the transition office created to develop the structure of a new national securities regulator, delivered a public address insisting the national regulator plan is alive and well, and dismissing concerns that the proposal is withering as more provinces speak out in opposition to the plan.
But despite the high-profile assurances that the project is on track, however, there is little clear support from the provinces who will be asked to voluntarily join the new regulator.
Four provinces - Alberta, Saskatchewan, Manitoba and Quebec - have said they will not join the national regulator, and a number of other provinces have been publicly non-committal.
The Supreme Court of Canada will hold a hearing in April to consider the constitutionality of the proposal. Provinces in support of the plan were supposed to file factums with the court by a deadline of Jan. 10, but only Ontario responded. British Columbia asked for a time extension, and no other province participated. Provinces opposed to the proposal have until Feb. 11 to submit factums.