In a speech to the Association of Financial Advisers (AFA) conference on the Gold Coast yesterday, Senator Sinodinos spoke directly to a number of policy issues affecting advisers for the first time since his post-election appointment.
“There is a lot of anticipation and speculation within the industry and the media about how the Coalition government will deal with FOFA – we have very clear election commitments on this issue,” Mr Sinodinos said.
While the government supports the underlying original motives of Future of Financial Advice (FOFA) and the Ripoll inquiry to “improve the trust and confidence of Australian retail investors”, the assistant treasurer said the ultimate reform package has concerning elements and “imposes a significant regulatory burden on industry”.
Mr Sinodinos specifically singled out “insurance remuneration” as one of the “top of agenda” issues within his ministerial portfolio.
“The differing insurance arrangements inside and outside superannuation create confusion,” he said. “The Ripoll inquiry did not recommend the banning of commissions for risk products; recent experience in the UK indicates that banning commissions on risk insurance just doesn’t work,” he added to substantial applause.
“Such bans increase costs for consumers, limit their choices and leave many worse off.”
In addition, Mr Sinodinos reiterated the Coalition’s pledge to remove the opt-in requirement as well as provide timely guidance on grandfathering and remuneration of corporate superannuation advisers.
More broadly, the minister said the government is supportive of the financial advice industry and wants to see it prosper – in contrast to the “shellacking” advisers received from the previous government.
“My aspiration for the industry is that it would be world’s best practice,” he said.
Thank goodness some balance seems to be returning. The attack on financial planning businesses has been relentless for years now, with industry “consultation” really only lip service.
Hopefully there can now be some positive outcomes for consumers and a halt to increase compliance and therefore costs.
The proof will be the pudding.
Remember this-over the decade of “reform” in financial services, the AFA has had to restart its relationship, and its “educational process ” with every new Minister as they got promoted, from both sides
Young Arthur is on the slippery pole upwards, so the AFA better give this top prioity and get the legislation passed urgently.
If we slack off because “our” friends are in power, and dont pursue the objectives with vigour, this nightmare will become Ground hog Day
It’s bitter-sweet news I guess. Great to see a government actually support this advice business and give us all some short term relief but with Bill Shorten now winning labor leadership his agenda will be to destroy our industry with more red tape, more FOFA laws and make it even harder for advisers to do business. It’s only a matter of time until that cancer-ridden government called ‘Labor’ win the next election again so make the most of the next 3 (or 6) years fella’s.
Nice to hear that the coalition “gets it” there is no free lunch and banning commissions leaves the public who in the main cannot afford to pay for risk or planning advice vulnerable to the poor options available within super, or online farcical coverage. If I had a dollar for every bad experience I’ve heard of with tpd in super I could almost retire!
Nice to see some good news first time in what 4 years?