The Senate Appropriations Commission Thursday narrowly approved a $21.7 billion appropriations bill that provides an 18% funding hike for the Commodity Futures Trading Commission (CFTC) in fiscal 2012 to implement reforms under the Dodd-Frank Wall Street Reform Act.

The financial services appropriations measure, which cleared the panel by a vote of 16-14, includes $240 million in funding for the CFTC for next year, an increase of $37.7 million over the current spending level for the agency to carry out its expanded responsibilities to protect the multi-trillion-dollar derivatives market, as well as the futures market, from fraud, manipulation and abusive practices.

The $21.7 billion spending bill, which was reported by the Subcommittee on Financial Services and General Government Wednesday, includes discretionary funding for a number of agencies, such as the Securities and Exchange Commission, Internal Revenue Service, Treasury and the CFTC, for the the next fiscal year, which begins Oct. 1. This is $224 million less than what was approved for the current fiscal year and $4.25 billion less than what President Obama requested for the financial services agencies.

The House spending bill, which was approved earlier this summer, sets aside far less for the CFTC in 2012. It allocates only $172 million for the agency in 2012, which is about $68 million less than what the Senate has approved so far and is $30 million less than the $202 million budget for the CFTC in the current year (see Daily GPI, June 17). The House and Senate will have to reconcile their budget differences.

CFTC officials have urged Congress to increase its funding so it can hire more staff members and bolster its information technology capability to oversee the over-the-counter derivatives market, as well as the futures markets. The derivatives market has been estimated to be about nine times larger than the futures market.

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