The Bill contained some key changes from what was set out in the draft legislation, in particular to the areas of conflicted remuneration for general advice and life risk commissions inside super (see: FoFA Amendments Bill Tabled With Revisions<\/a>).<\/p>\n Speaking to riskinfo on the Bill, the Association of Financial Advisers\u2019 (AFA) Chief Operations Officer, Phil Anderson<\/strong>, said he was surprised that the Government had chosen to remove the exemption on commissions for life risk inside super.<\/p>\n \u201cWe wanted it to be extended to address the situation of corporate super advisers giving personal advice to employers, and delivering the improvements from the default insurance arrangements. But what we\u2019ve seen is they\u2019ve taken it out entirely.\u201d<\/p>\n Mr Anderson said the AFA had not been approached by the Government or Treasury in relation to its consultation with the life insurance industry. \u201cObviously we\u2019ll want to talk to them now,\u201d he said.<\/p>\n Commenting on the changes to the exemption on conflicted remuneration for general advice, Mr Anderson said the Government had significantly tightened the definitions surrounding the measure.<\/p>\n \u201cThis is a good thing. What they have done is provide greater clarity as to the circumstances when this exemption would be applicable. There has been a lot of media coverage which has accused financial advisers of engineering a return of commissions – this just takes the vast majority of financial advisers out of play (in relation to the exemption).\u201d<\/p>\n The Financial Planning Association (FPA) also praised the Government for the change to the general advice exemption.<\/p>\n \u201cToday\u2019s change of tack by the Government is a welcome approach. It shows our repeated efforts on behalf of Australian consumers and professional financial planners have not gone unheard,\u201d said FPA CEO, Mark Rantall<\/strong>.<\/p>\n However, the FPA still believes the legislation could go further:<\/p>\n \u201cWhilst this policy shift tightens the pre-conditions under which conflicted remuneration can be paid and is welcomed, the FPA still calls for the removal of the ability to reintroduce superannuation and investment commissions on general advice altogether,\u201d Mr Rantall said.<\/p>\n The Financial Services Council (FSC) commended the Government for the introduction of the legislation. FSC CEO, John Brogden<\/strong>, said: \u201cThe government has fulfilled its mandate to make advice more accessible and affordable for Australians whilst maintaining consumer protections.<\/p>\n \u201cTechnical amendments in the legislation will now allow consumers to get the advice they can afford and want.<\/p>\n \u201cIt also brings clarity and certainty to the advice community, particularly in relation to scalable advice and the best interest duty.\u201d<\/p>\n Industry Super Australia (ISA) was one of the first industry bodies to comment on the introduction of the FoFA amendments legislation, arguing that it would do more harm than good.<\/p>\n \u201cIn seeking to cut red tape the Government hasn\u2019t adequately taken into account the potential costs to consumers and the industry from re-permitting commissions through general advice and weakening the best interests duty,\u201d said ISA CEO, David Whitely<\/strong>.<\/p>\n \u201cIn one fell swoop, supposed red tape savings for businesses could be far outweighed by consumer losses and reputational damage to the industry itself.\u201d<\/p>\n The ISA did, however, welcome the removal of the measure which would have permitted commissions on group risk insurance in super. But the organisation was not impressed with the Government\u2019s approach to its criticism of the general advice exemption.<\/p>\n \u201cThe changes to the scope of the general advice exemption are minor and will still permit the payment of commissions on compulsory super including MySuper products,\u201d Mr Whitely contended.<\/p>\n Finally, Mr Whitely argued against the \u201crushed\u201d approach to the implementation of the amendments: \u201cThe Government should bring together key stakeholders to find a<\/p>\n sustainable outcome that reduces compliance costs without compromising key consumer protections. Such an outcome is achievable if common sense prevails.\u201d<\/p>\n![\"\"](\"https:\/\/riskinfo.com.au\/news\/files\/2014\/03\/Phil-Anderson-2-AFA.jpg\")
<\/a>…the legislation will now allow consumers to get the advice they can afford and want<\/h6>\n
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