The Future of Financial Advice (FoFA) Bills have been passed by the Senate this afternoon, following a restricted debate which commenced earlier this week.
Shortly after the resumption of the debate by the Senate, the Government tabled the highly anticipated amendment to alter the legislation commencement date.
As expected, the Government’s amendment introduces a transition period, which delays the formal commencement of the legislation to 1 July 2013. The amendment follows the terms of the draft regulation circulated for review in April, allowing financial service providers to voluntarily comply with the new legislation any time between 1 July 2012 and 1 July 2013.
Specifically, the revised arrangements provide that if a licensee elects to voluntarily comply with the FoFA reforms prior to 1 July 2013 they must lodge a notice with the Australian Securities and Investments Commissions (ASIC). The legislation will then apply to that licensee and all its authorised representatives from what is called the ‘application day’; that is, the day specified in the notice lodged with ASIC. Licensees must comply with all elements of the FoFA legislation.
The Coalition was critical of the last-minute introduction of the amendments, and the detail proved confusing with some Senators’ speeches still referencing the fact that an amendment to alter the legislation commencement date had not been tabled.
The Coalition, led by Senator Mathias Cormann, also tabled amendments to the Bills. These changes, which followed similar amendments put forward in the House of Representatives, included:
- A requirement for the Government to undertake a compliant regulatory impact assessment
- Removal of the opt-in requirement
- Clarification around the banning of commissions on risk insurance inside superannuation
Debate on the Bills was restricted by a ‘guillotine’ motion, passed by the Federal Government earlier in proceedings. This motion, which restricts the length of time that the Parliament can spend debating a particular issue, was widely criticised by the Coalition Senators, with some arguing it showed the Government’s disdain for financial advisers. However, the debate ultimately concluded at midday today, and was followed by numerous divisions which saw the passing of both Bills and the related Government amendments.
The Bills will now be returned to the House of Representatives for final consideration, before they are presented to the Governor-General for assent.
All Financial Advisers must now campaign very hard to vote this Federal Labor Goverenment out of office, similar to their Queensland defeat got blasted out. We are the only occupation that had to go through so many changes and yet these politicans can leave parliament, become lobbyists, form business partnerships and still receive the fattest commissions without any restrictions or guidelines — shame on them.
The ultimate in incompetancy, at a Federal Govt level, has actually outdone itself yet again. What clowns do we have in charge of Australias best interests, and where, oh where, are they leading us!! It aint all bad, most of us are prepared to concede.. this FoFA animal, but dressed to kill, as it surely is, it will be seen as an ultimate sign of this Governments Robin Hood view of our world. Decieve the average punter, take away his appetite to value advice and independance, and leave him wondering what really went wrong!!
Oh dear Mr Shorten, you will have some legacy to live up to.
We all know that Bill sShorten has one agenda and that is to stop the ‘Wealthy’ planners getting 7 times?? [please let me know where this buyer is] their trail commissions by reducing their business to ashes. This man has from the time he stepped into parliament has had grandeur written all over him and playing the ‘wealthy vs the Poor’ game he has made honest businesses look like crooks. We all know he has the industry super funds at heart. 10 years from now when he is retired on his $1Mill+ super we will start to see the failure of this legislation and its full ramifications, of course he will have been long gone. Unfortunately so will good value honest Financial Planners who have been priced out of business. Plus many retirees will find that somewhere along the way they needed to change things but the advice given was a ‘one size fits all’ strategy. This man has not listened to anyone but his own ego, in fact, that seems to be the way of these power brokers in Canberra. Pay millions for advice on how to do things then do it the way you wanted regardless of any warnings the report you paid for or care for the ones you hurt.
What will be achieved by this legislation?
No adequate advice for members of Industry Funds.
No proper governance of Industry funds to prevent corruption and fraud.
The continuity of sinecures on the Boards of Industry Funds for Union Bosses and past and rejected Labor politicians (rejected democratically by the electors of this Nation).
Continuing payment of acting fees to the likes presumably of Bernie Fraser, when appearing in advertisements for Industry Funds.
No satisfactory control of bankers who have participated in loans to investors who could not afford them.
Massive impairment of the wholistic advisory work of the majority of competent Financial Planners due to unnecessary regulations by bureaucrats who have no real knowledge of our Industry/Profession.
The casting of a slur upon us which has been totally unjustified.
Vote out this Government. Abolish the farce which is the Industry Fund system run by Unions for the benefit of tired old Union Bosses and past politicians. Restore democracy to this Nation whose work force rejects Unionism and (hard) Labor Governments. Bring on an Election!!
The rate at which people are currently leaving industry funds in search of quality advice has never been more evident.As a planner I don’t mind the industry funds growing the client balances to a point where the client desperately needs a planner to advise them.I think the worm will turn and industry funds will simply be a parking bay for smaller balances,as eventually the individual will realise they need real advice to help navigate them through the maze of retirement.
Client just called- 55 YO- Wanted to surrender super (MLC & industry fund) and put in a term deposit. Had walked into NAB for advice and quoted $1100 fee and 2% ongoing- walked away.
A clear danger to himself & indication of where the future lays. This Government is moronic!!
Comments are closed.