In a statement issued today, Assistant Treasurer Arthur Sinodinos announced the government will present a number of amendments to parliament, consistent with the Coalition’s red tape reduction agenda.
“The government supports the principles of FOFA. However, the previous government’s reforms went too far, creating unnecessary complexity, imposing significant burdens on industry and reducing the availability and increasing the cost of advice to consumers,” the statement said.
Among the amendments, the government will push for a complete removal of the opt-in requirement, describing this element of the existing FOFA reforms as a “burdensome layer of red tape”.
In addition, Senator Sinodinos announced that the government will amend the fee disclosure statement requirement so that it only applies to new clients from 1 July 2013.
The government will also exempt general advice from the ban on conflicted remuneration, amend the best interests duty to allow for the provision of scaled advice and amend grandfathering provisions to ensure that advisers can move between licensees while maintaining access to grandfathered benefits, ending the competition impediment currently in place.
Senator Sinodinos will be expanding on the FOFA changes as well as the Murray Inquiry at an upcoming business lunch in Sydney, sponsored by ifa. To reserve your table or seat click here.
Scrapping the lot would be a better start !
Put the crooks in jail, compensate the victims and let sensible customers be serviced by good business people conducting good business
Amazing what happens when the adults take control again. This is simply a mature common sense approach to the issue.
After the topic being controlled by the Unions via the ISN/ISA and ALP/Greens for the past 6 years it is great to see someone who is trying to find a balance between protecting consumers and not ham-stringing the Advisers.
Unfortunately, we will probably have to wait until after 1 July 2014 to get this passed as the Left wing Coalition will no doubt block it in the Senate. When will they realise they list the election and get out of the road so adults can fix their childish mistakes.
I regret to put any dampener on the one piece of good news released this week…. the trick will be getting the changes through the upper house just like all the other pledges made and voted for being held up by the greens and the disgruntled opposition senators, including $20b of savings, $5b of which were their own!! Electricity Bill is no Hawke that’s for sure.
A victory for commonsense after six years of union fund led madness. I agree wholeheartedly with Scott, such a shame we had to spend so much time and money trying to comply with rules designed to put us out of business.
Well, Well, Well, finally we have somwone with someone with some commonsense and business acumen. What a difference the changes are going to make with a return to client relationship. I have been a fee for service adviser all my career so I do not have a problem with that aspect and the removal of the opt-in is just a no brainer. The SOA was originally designed to declare the fees and the ATP indicates that the client accepts the costs and charges up front. Thank god we can return to reality.
Absolutely fantastic Christmas present.Just a pity we have spent thousands of dollars in gearing up to provide Fee Disclosure Statements .
Advisers are still not declaring to the client there total fees they or there dealer group and their parent companies receive.
The Fee Disclosure Statement should show all fees payable to the Adviser, The Dealer Group and to any other related companies.
Example:
FDS declares what the Adviser gets paid, including insurance and product fees
FDS declares what the dealer group gets paid – In the event of an annual lump-sum and Adviser receives 100% of the payment, this should be noted
FDS declares what any parent/related companies get paid, i.e. a bank adviser placing clients in a banking product, the FDS should declare what fees the parent or related company receive as a result of the investment
How can a Statement of Advice which includes insurance and product fees differ from the FDS? Only makes the fee declaration more complex for clients.
Put the consumer first not the banks!