Labor strikes deal to disallow FOFA changes

The two crossbenchers have joined Labor senators opposing the government's FOFA agenda, according to a spokesperson for Labor Senator Sam Dastyari's office.

"Senators Lambie and Muir have spent the last three to four months listening to the concerns of both the government and the financial advice industry, and the concerns of national seniors, pension groups, consumer advocates such as Choice and, of course, victims of poor financial advice, and they have changed their position," the spokesperson told ifa.

"They have moved over to vote with the Labor, Greens, Madigan, Xenophon opposition to disallow the regulatory changes that were introduced on the first of July."

The backflip by Senators Muir and Lambie follows a spat between Ms Lambie and PUP leader Clive Palmer, which saw the Tasmanian senator contravening PUP party line to vote against the government's social services Bill this week.

Mr Palmer this morning took to social media to announce that Senator Lambie had been demoted within the party's ranks.

"The @PalmerUtdParty has removed @JacquiLambie as party's deputy Senate leader & deputy whip & suspended her rights to attend party meetings," Mr Palmer tweeted. 

In July the government negotiated a deal with Clive Palmer to save the FOFA amendments.