Royal Commission will derail current reforms
The Financial Services Council (FSC) has urged the Federal Government to prioritise a raft of reforms in the financial services sector before contemplating a Royal Commission into the banking sector.
In listing reforms the Government and the Parliament should focus on, FSC chief executive, Sally Loane, said the FSC's Life Insurance Code of Practice would be complemented by legislative reforms in response to the Financial System Inquiry and the Trowbridge Review.
"This package of legislative reforms for financial services was ready to be implemented by the last Parliament, and represents a much more effective and efficient course of action than an expensive and long-drawn out Royal Commission which would only derail reforms already in the pipeline," Loane said.
The FSC also said the life insurance industry and the FSC were finalising the Code of Practice, which would look at areas like product design, sales practice, underwriting, and claims, which would be launched in October.
The FSC asked for focus on the following matters:
- Reintroduction of the Life Insurance Reform Bill to tackle "misaligned incentives";
- Reintroduction of legislation to encourage choice and improve governance in the superannuation industry;
- Introduction of legislation to increase professional standards required of financial advisers; and
- Lower withholding tax regime for foreign investors to support Australian investment managers seeking new markets in an ever competitive global market.
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