In his final media statement as financial services minister, Mr Shorten singled out FOFA, describing the regulatory package as one of a “number of historic Labor reforms” he led during his tenure.
“It was a privilege to serve as minister for financial services and superannuation in the Gillard Labor Government,” he said.
“We have built upon on the great legacy of [prime ministers] Hawke and Keating, which improve the transparency and fairness of our financial services sector.
“We’ve bought the financial planning industry into the 21st century by removing conflicted remuneration structures and challenging the industry to become more professional, a challenge which I think the industry has and will continue to rise to.”
Mr Shorten also thanked the industry for “working co-operatively and diligently” with him during the reform consultation and implementation process.
Shadow minister for financial services Mathias Cormann issued a very different statement, describing his former counterpart as the “part-time” financial services minister.
“During his time as financial services and superannuation minister Bill Shorten made Australia into the world champion of financial services red tape.
“As well as imposing massive additional red tape on the financial services sector, he did everything he could to protect the vested commercial interests of the union movement at the expense of the broader public interest.
“Bill Shorten’s so-called Future of Financial Advice changes and other changes to super have increased compliance costs for financial services and superannuation by a staggering $1.5 billion – this massive increase in compliance burden has pushed up the cost and reduced the availability and accessibility of financial advice for consumers.”
Senator Cormann also said the splitting of the financial services portfolio, without a single minister dedicated to the policy area sitting in Cabinet, indicates a “downgrading” of the portfolio’s importance under Rudd’s leadership.
Association of Financial Advisers chief operating officer Phil Anderson told ifa that while the incoming treasurer Chris Bowen is well briefed on the industry – having served as financial services minister during the Ripoll inquiry in the first Rudd government – that the AFA’s preference would be for a single, dedicated minister for the policy area to sit in cabinet.
“[Treasurer] is such a big job, it’s probably the case that it will not be possible for [financial services] to be given the focus it needs,” he said.
The whole idea behind this is to move us all back to the institutions or rid us from the industry.
Stop practices from become larger.
The bank Model which i came from years ago, allows you to keep 50 to 100 clients max then remainder must be past on to a review planner. This is why alot of advisers with their own practices that have slaved their entire lives building it up can be very cynical of this rubbish. Its is anti-competitive, 100% socialist wrapped up in their red tape. Whats a client meaant to do that has a small super fund with you that also has Insurance that wants to make a claim say 3 years down the track when they are sick in bed dying call a call centre to help ? Well we have seen how Hesta handles that on Thursday night ACA
I can’t wait for the next lot of legislation, think of all the education and useless exams I will have to do? I have read this how does pushing up the compliance burden help small independent advisers may I ask?
Oh dear – I wonder if Mr Shorten believes that?
I’ve read much of the comments with great interests and agree with just about everyone of them. I have always been a big proponent of the fact that Shorten is only looking after his mates. After all why would they want to go after an adviser being transparent and charging a fee and not the commission based adviser; it doesn’t make sense. Steve you are 1005 correct with regards to the AFA and FPA of old but they have done much to improve of the later years. However I completely disagree with you with regards to the education component; I’m a strong believer in education and financial planning is easy as long as you know what you are doing. I know many planners that have been in the industry for 20+ years and still can’t understand basic TTR strategy.
all i know is if my clients are upset they tell me or they walk, they dont require another letter outlining what i do for what i charge as they see it in our upfront, on our review or when we or they call. Seems like more constant red tape, iress seem like winners, isn seem like winners, labor and shortstuff seem like winners, ASIC and us are left with the load for what real benefit to the consumer ? ( having a break in between my 10th FDS for the month )
Well Jason….the trap was moving into the so called fee for service. Although it seems the right thing to do, being open and forthright about disclosures, it has certainly come back to bite us. The alternative of course was to bill our clients direct or do some type of direct debit like accountants now do….problem is the dealer group likes to take their cut first and the attractive volume overrides ensure it is uneconomical for most of us to charge outside the platforms we use. So we’re hamstrung by dealer groups, sliced and diced by the regulator and treated like crooks by the ISN chief. Meh….what’s an adviser to do?
[quote name=”Steve”]Hey, yes Shorten is a tool, he knew very little about how the FP industry worked & had to be guided & advised all the way. His knee jerk reaction, decisions & policies were DREADFUL. The steaming pile of you know what AKA FOFA, is 95% driven by the FPA & te education mafia. These bodies like the FPA, Kapan & AFA have sold out every adviser & the industry to secure their hugely profitable fee driven future, flogging useless memberships & templated online courses that deliver nothing but box ticking certificates. Want to change your industry? STOP YOUR FPA, AFA & Kaplan memberships. Seriously, financial planning isnt hard, constantly saying more education isnt the answer FPA![/quote]
The AFA have made a massive effort to try to get good outcomes for Financial Planners, otherwise I agree with the rest of your comment.
The Time they have given us to even have all this useless rubbish done as well as continue to run a business is totally beyond me. Its like they want trap us and kick us out. Its just plain Evil, they have treated every practice like we are criminials. Can anyone see this changing or all locked in all over red rover ?
It’s time the FPA and AFA stood up and told them to piss off.
we are just colateral damage i feel which is sad after setting up my practice from scratch 15 years ago 🙁
I have not met 1 client who knows about or can explain what FOFA is, so you call that successful? you’d make a great politician.
Yes – well done Bill. For those of us who already provide valued advice to clients on a fee for service basis we now have less time to spend with each of them. For those who sat back and collected commissions from products for years without necessarily even knowing who the client was . . . . carry on!Great reforms – well thought out. Good luck Bill in stuffing up your next portfolio.
ROFLMAO
Oh thats funny!!!
Mr Shorten, Gillard, Rudd and the party have timed it perfectly it appears. Shorten pushes the TASA reform through just days before a leadership spill and cabinet reshuffle. Can’t help but wonder how planned all of this was.
Like Jason said, i too have many new SoA’s, RoA’s and FDS to do and to remain compliant, I have not seen my kids over school holidays thanks to a government that his it’s own agenda. As Aleks wrote Shorten was protecting the union movement and the industry funds because that’s his next target job. Feel sorry for the education sector, he will damage that industry too, as if it could not get worse!!!!!!
Hey, yes Shorten is a tool, he knew very little about how the FP industry worked & had to be guided & advised all the way. His knee jerk reaction, decisions & policies were DREADFUL. The steaming pile of you know what AKA FOFA, is 95% driven by the FPA & te education mafia. These bodies like the FPA, Kapan & AFA have sold out every adviser & the industry to secure their hugely profitable fee driven future, flogging useless memberships & templated online courses that deliver nothing but box ticking certificates. Want to change your industry? STOP YOUR FPA, AFA & Kaplan memberships. Boycott the FPA especially, this body has sucked the life out of this industry with its decades of self preserving, fear mongering & course flogging instead of actively pursuing the BAD EGGS with ASIC & ridding the industry of the ones causing the problem. NO….much better to flog your courses by blaming education. Seriously, financial planning isnt hard, constantly saying more education isnt the answer FPA!
i sit at my desk at present
on my right 3 new SOA’s
10 ROAs
50 FDS for the Month
some over lap
therefore some will get a SOA and a FDS
some will receive a ROA and a FDS
This is a Full on Month, hope i make it to the End…… Thanks Mr Shorten your a real crdeit to society and have Run a business before …… NOT!!!!!!! love to see the libs win your seat off Essendon
Senator Cormann’s comments are 100% correct but unfortunately Shorten has now moved away from the responsibility of facing the problems introduced by his socialistic reforms. But hey, let’s not be to cynical, he has achieved most of the goals of his rabble unionist colleagues in their ever constant efforts to break down free enterprise and replace it with true socialism. As an aside, without the income the unions are now receiving from their industry funds they would all be broke and out of business as their dwindling memberships cannot support them. But the one who is going to really be deceived by Shorten is Rudd who has been sold a dump by Shorten. When defeated at the next election and steps down, Rudd will be replaced by Shorten who did not have the courage to lead the socialists into the election.
Shorten could not lie straight in bed! He has achieved nothing for the vast majority of clients except added costs. He has created open slather for union funds & bank owned funds to continue to plunder & provide biased advice.
This typical of this disgraceful Labour party: self serve, complete dishonesty & total lack of interest in the actual people they are supposed to serve.
I really don’t understand how creating even more legislation and red tape improves professionalism and delivers a better service for consumers. In my view, what it does do is protect union based industry funds and create more confusion for ASIC who already have great difficulty in protecting anyone because they are so tied up in knots with the ever increasing volume of confusing regulations. ASIC has been asleep at the wheel for a long time. They dozed off from red-tape fatigue.
The FOFA legislation has been in force just 2 days and there is industry wide scepticism as to what it will achieve, other than more paperwork for advisers and therefore more fees for customers.
The last big reform (Financial Services Reform Act) did not stop Storm and other similar mass product flogging, why, because they just did not comply and there was no real enforcement by ASIC.
The only claim shorten can really make is that of looking after his mates. If he really wanted to improve financial standards, he should have included transparencey on all forms of remuneration and from all sectors and placing the industry funds on the same level playing field.
[quote name=”jay”]i will tell you guys, i 100% agree with all your comments. The disspointing thing i have found is how many advisers previously on here have welcomed these changes as if they are Knights and this is the correct way we should be going, blah blah blah and that all planners bar them are crooks. Ive never seen anything like it in my life, just very disspointing alround[/quote]
You mean the deciples of Jim Stackpool ?
Theres a guys going out of business fact now that we all have to follow his dictates.
no choice Jimbo.
Amazing that the govt has not moved on MORTGAGE BROKER TRAIL and the 8% that REAL ESTATE AGENTS CHARGE for managing investment properties ….. THATS NEXT.
Mathias said it all really. Shorten should just hang his head in shame!
Thinking about Bills Mate Whitley and ISN its makes very interesting reading on all the co branded sites, host plus cbus and the rest to see that the offer financial planning face to face. BUT do not quote prices – you have to call to get that data and guess what ? The cost is between $650 – Aust supers $4280. So, advisers are evil and we dont charge commissions but, we will outsource the advice face to face to advisers that can actually do the best by the client. As well, under best interests how can you invest ANY funds in industry funds with UNLISTED PROPERTY ASSETS VALUED WHENEVER THE TRUSTEES DECIDE ?
When Chant West and Rice Warner ( the insdustry fund best buds ) do the comparision do the mention or include that aspect ? no ? then hows that apples for apples ?
VOTE 1 Mathias Corman !
It seems that Bill put all his money on Red and came up, well, Shorten.
I wonder if he will now increase the professionalism of the Aust Labour party? Or will we continue with the likes of the Craig Thompson financial affair !!
Bill Shorten is a blight on Financial Services. He has cost our business significantly. He has done more damage than good and has greatly cost the consumer,in particular the less wealthy client who really needs the advice. So thanks for nothing Mr Shorten.
i will tell you guys, i 100% agree with all your comments. The disspointing thing i have found is how many advisers previously on here have welcomed these changes as if they are Knights and this is the correct way we should be going, blah blah blah and that all planners bar them are crooks. Ive never seen anything like it in my life, just very disspointing alround
I’m still trying to work out how Bill’s intervention has made things cheaper for my clients? It will certainly cost me a lot more to provide the service!
What a egomaniac. All he has achieved is push significant expense on the planning profession which in turn is passed to clients.
Regulation is not reform.
How ironic that a member of the least professional and most shambolic government this country has ever known takes it upon himself to pontificate on the professionalism of others. It is the conflict of interest between this government and the trade unions that control it, that really needs regulating. Look at your own back yard first, Bill.
These guys live in a totally different world to you and me. They live on Planet X and cant understand why they came to earth
Just another statement from someone in the Labor party bordering on delusional .”Brutus” Shorten must be the most untrustworthy politician to have graced the corridors of parliament since “no child will live in poverty ” Hawke rolled Hayden . Sick of listening to the clown so bring on an election and hopefully roll some of this garbage legislation back .
I feel sick reading this. Everyone loses except the ISN. Disgusting.
What a joke. All he has done since taking the finnacial services portfolio and with FOFA is burden us with more compliance and look after his union cronies. How that results in increased professionalism is beyond me.
Professionalism is a state of mind and impementation of appropriate practice. It doesnt come from driving the industry crazy with increased compliance. All that does is result in further costs to the consumer!
It was important whilst Shorten was implementing his dastardly deeds on the advice of David Whitely….but now that the hatchet job is complete, they can sit back and watch everyone else suffer including the public. Already I get a client throwing me their sunsuper my super letter asking me to sort out what they’re supposed to do. Fine….I’ll look at it but here’s my big fat FEE because your super fund won’t let me charge your account for superannuation advice… or you could phone the super fund directly and get free advice….well actually it’s not free because the fee is built into the admin costs which will probably go up.