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Backbenchers warm to royal commission

NAB’s admission of wrongdoing by 37 of its advisers may tip the balance in favour of a royal commission into the financial planning industry, says a Coalition senator.

Speaking to ifa yesterday, Nationals Senator John Williams said there is growing support among MPs for a formal royal commission process, as recommended by the Senate inquiry into the performance of ASIC last year but rejected by the Abbott government.

“I have spoken to a range of backbenchers that are now supporting the Royal Commission,” Senator Williams said. “They have constituents affected; the push is growing.”

Mr Williams has provided terms of reference to Treasurer Joe Hockey for a wide-ranging royal commission into “white-collar crime” that will include the financial planning industry.

The fact that another household name advice provider has been found to have harboured inappropriate or low-quality advice will further erode public confidence in the industry, Senator Williams suggested.

“We now have three of Australia’s largest financial institutions where wrongdoing and misconduct in financial planning has been carried out,” he said, referencing the Commonwealth Bank and Macquarie.

“Something needs to be done to restore confidence to investors and people who are having their money managed. Australians need good advice and safe products.”

The senator – who was instrumental in getting the Senate inquiry into ASIC off the ground and is an outspoken critic of vertical integration – said the corporate regulator also has questions to answer.

“I’ll be questioning ASIC this week in Senate Estimates,” he explained. “If they have known for some time perhaps a little transparency would have been helpful.

“Telling the truth never hurts.”