* House panel seeks to slash CFTC funding by 12 pct
* Second panel votes for only a $50 million increase for SEC
* Republicans say CFTC does not deserve budget boost
* Democrats critical of proposed budgets for regulators
* Republicans also seek money market fund study by SEC
By Charles Abbott and Sarah N. Lynch
WASHINGTON, June 6 Two U.S. House Appropriations
panels on Wednesday took aim at the budgets of the country's
leading financial market regulators, voting to slash spending
for one agency and only marginally boost funding for the other.
The Commodity Futures Trading Commission would get a 12
percent budget cut for fiscal 2013, from $205 million to $180.4
million in an agriculture funding bill approved by one House
The Securities and Exchange Commission, meanwhile, would see
its budget rise by $50 million, from $1.32 billion to $1.37
billion under a financial services spending package approved by
another House Appropriations panel.
Despite the increase, the SEC's budget would still come with
some strings attached. It would be forced to earmark $50 million
toward information technology projects from the budget, instead
of being able to tap a separate reserve fund.
The proposed budgets for the SEC and CFTC are well below the
spending levels advocated by the Obama administration, which has
called for large funding boosts to help the agencies implement
sweeping new reforms required by the 2010 Dodd-Frank Wall Street
"The CFTC's hardworking staff is just 10 percent more in
numbers than at our peak in the 1990s, yet Congress has now
directed the agency to oversee the swaps market that is eight
times larger than the futures market," CFTC Chairman Gary
Republicans critical of Dodd-Frank have been seeking to use
the power of the purse as a way to delay implementation of some
of the new regulations. But Democrats have balked at the
proposed cuts, saying the recent $2 billion losses at JP Morgan
and the bungled Facebook initial public offering demonstrate the
need for greater funding and resources.
On Wednesday, Democrat Rosa DeLauro sought to win support
for an increase that would bring the CFTC's budget to $308
million. Her plan was defeated by the subcommittee on an 8-5
party-line vote. She vowed to bring the issue up again when the
full House Appropriations Committee takes up the CFTC budget in
Jack Kingston, the subcommittee's chairman, cited the CFTC's
poor oversight of collapsed brokerage firm MF Global and its
slow implementation of new rules in rejecting a proposed
"They were asleep on the job," said the Georgia Republican.
Republicans also took the opportunity on Wednesday of using
the spending package as a way to possibly delay other pending
new SEC regulations for money market funds that they oppose.
The financial services spending bill would require the SEC
to conduct a study on money market funds and the effectiveness
of new rules for the industry that took effect in 2010.
The provision was added as SEC Chairman Mary Schapiro
continues her quest to impose additional rules on the fund
Schapiro has said the SEC is looking at several options,
including possibly a capital buffer coupled with redemption
hold-backs, or a floating net asset value.
But the fund industry along with three of the SEC's five
commissioners have voiced opposition to her proposals, saying
the new regulations implemented in 2010 as a response to the
financial crisis were enough to stabilize the money market fund