The financial watchdog has been told to do better as Treasurer Josh Frydenberg rejected claims it doesn't have enough money to do its job properly.
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An independent review found the Australian Prudential Regulation Authority was too secretive, unwilling to challenge itself and slow to respond to problems.
Staff anonymously criticised leadership for not forcefully taking on financial institutions and struggling with culture and governance.
APRA's chair Wayne Byres argued the organisation needed more funding if it was to meet community expectations.
Mr Frydenberg said the federal government already boosted the watchdog's funding by $200 million last year, and would consider requests for more money in next year's budget.
"But APRA is moving from having just over 600 staff to over 700 staff this year, and we will ensure it's not only got the right legislative tools and the right penalties in place, but also the right resourcing," he told Seven's Sunrise on Thursday.
Mr Frydenberg has spoken to Mr Byres, who is "very conscious of the need to act quickly, and he is already taking action".
"There's no doubt that APRA does need to do better and this report makes it very clear that they have been too slow to respond to some of the technological challenges that an organisation such as that faced," the treasurer told reporters in Toowoomba.
"Too many of their negotiations with the organisations that they prudentially regulate have been conducted in secret ... and when it comes to superannuation there hasn't been a sufficient focus on member outcomes and ensuring that they get the best possible deal."
APRA appears to have developed a culture that is unwilling to challenge itself.
- APRA report
Retail and industry super advocates are at odds over calls to give the financial regulator powers to better police the performance of superannuation funds.
Industry Super Australia has welcomed the proposal, but the Association of Superannuation Funds of Australia says shifting the regulator's focus from long-term stability to short-term performance measures risks damage.
Former consumer watchdog boss Graeme Samuel led the review after the regulator was slammed by the banking royal commission.
"APRA appears to have developed a culture that is unwilling to challenge itself, slow to respond and tentative in addressing issues that do not entail traditional financial risks," the report said.
It also said a division entirely focused on superannuation is needed, to oversee how the system performs for its members.
All of the report's 24 recommendations have been accepted.
