AMP has released details of the likely cost to implement the Future of Financial Advice (FoFA) reforms within its Australian businesses.
In its half yearly performance results, released last week, AMP has indicated it has already provisioned a budget of $58 million to implement the necessary business changes resulting from FoFA, Stronger Super and other regulatory reforms.
In total, the company estimates the full, one-off implementation cost to be between $60 and $75 million after tax.
… we’re still waiting to see the necessary policy detail that will allow us to finalise the required business changes
Speaking about the reforms, AMP CEO, Craig Dunn, said: “While we’re well-advanced in our preparedness for the new regulatory framework, we’re still waiting to see the necessary policy detail that will allow us to finalise the required business changes”.
AMP says the final costs may vary from those quoted above, depending on final legislation and regulatory guidance, market practice and the future competitive landscape.
Opposition Minister for Financial Services and Superannuation, Mathias Cormann, has labelled the costs as “massive”, saying they will ultimately make access to financial advice less affordable for consumers.
“These are the costs incurred to pay for Bill Shorten’s additional red tape by just one company,” Senator Cormann said. “No wonder Bill Shorten never took his FoFA changes through a proper regulatory impact assessment to assess the cost/benefit equation, arrogantly failing to comply with the rules set by his own government.”
