Industry bodies have expressed their disappointment at the findings of the Parliamentary Joint Committee’s (PJC) review into the Future of Financial Advice (FoFA) Bills.
A report outlining the findings of the review was tabled in Parliament today. However, the PJC was unable to reach a consensus in relation to the proposed legislation, with the Coalition Committee members issuing a dissenting report.
The CEO of the Self-managed Super Fund Professionals’ Association of Australia (SPAA), Andrea Slattery, said there were some positives in the recommendations but that further changes were required.
SPAA is supportive of the PJC’s recommendations to clarify the Best Interest duty and to remove the geographical restriction on professional development. However, Ms Slattery called on the Government to provide greater detail regarding scaled advice, and annual fee disclosure statements.
The Financial Planning Association (FPA) said the PJC had missed an opportunity to deliver the benefits that FoFA was originally intended to bring.
Mark Rantall, FPA CEO, said: “The FPA is disappointed with the overall recommendations outlined in the PJC’s report on FoFA. Whilst the report acknowledged some of the concerns raised by the FPA, the majority of the suggestions the FPA made throughout the inquiry, and indeed recommendations made by other representatives of the financial planning industry, have not been adopted.”
Association of Financial Advisers (AFA) CEO, Richard Klipin, said the delivery of two reports reinforced the fact that there were two dominant views throughout the debate.
“The PJC process flushed out the views of many industry players and the industry as a whole became more forthright in its views,” he said.
According to Mr Klipin FoFA has now become a political issue.
“We are not surprised that FoFA will ultimately be decided by the Independents,” he said. “The issue will be resolved on the floor of the House and the Independents will be key.
“We urge the Independents to review the evidence put forward by the industry which reinforced many of our key concerns – namely, that FoFA, as it currently stands, doesn’t deliver, creates an un-level playing field that advantages one sector of the industry over another and will ultimately result in poorer outcomes for consumers.”
The Financial Services Council (FSC) said it was disappointed at what it called the PJC’s “unwillingness” to listen to the concerns of the financial services industry and make pragmatic changes to improve the legislation.
“Chief among our concerns with the current legislation is that it will not allow for an effective scalable advice framework,” FSC CEO, John Brogden, said. “Further, the Best Interest Duty fails to provide certainty for consumers and advisers on the parameters of their relationship.”
He added that while the FSC supports the majority of the FoFA reforms, including higher standards for financial advisers and an end to commissions, in its current form the legislation puts the availability of affordable advice at risk.
As always in this particular issue, the silence of the FPA has been deafening!!
I agree with Richard Klipin that this has now become a political issue and all Advisers should see their local memebers of Parliament and tell them that the original intent of the Ripoll inquiry has been well and truly exceeded!
It has been quite clear from the beginning that this government pretends to consult and then does what it wants to do pandering to vested interests. Labor MPs have no say in the matter. Nothing will happen unless the government is changed.
The PJC fails in delivery is not really a surprise given this governments approach in ALL it has so called achieved to date. This government whose ministers are nothing short of self interest incompetants who cannot run a canteen let alone a country have once again demonstrated that they are only willing to support the cause of self interest for themselves and their union mates. Enough is enough. As members of this industry, we should rally to a call not only to save this industry but also the nations by asking clients to petition the coaltion to block supply and call an election. Its time for this bunch of arrogant morons to go. They do not deserve to be in office.
One of the most glaring examples of the government pandering to the unions is the acknowledgement by Swan and Shorten that while they will stop volume rebates payments from platforms to independant advisers, they will not stop union super funds’ secretly subsidising their advisers becasue it’s too hard!
While Wayne Swan gives a free character assessment to the likes of Twiggy Forrest and Gina Rinehart , One wounders about how much the industry funds are pushing through thier agenda through thier mates at the Labor Party to get rid of thier competition rather than evolve and become better at what they do by becoming more client focused
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