Commissions to cost consumers $7.5b: report
Consumers face additional fees and charges of up to $530 million a year if the Federal Government backs proposals to reintroduce commissions, a report from Rice Warner reveals.
The research commissioned by Industry Super Australia (ISA) found the proposed amendments to the Future of Financial Advice laws would cost consumers $7.5 billion over 14 years.
Responding to the report's findings, ISA chief executive David Whiteley reiterated claims he made earlier this week that the changes would cut consumer protection, and urged the Federal Government to reject the lobbying of the major banks for the return of sale commissions for financial advice and compulsory super.
"The report debunks any claims the banks and financial planners that cutting consumer protections will reduce the cost of advice," he said.
"The reality is that cutting consumer protections just increases commissions and fees paid to financial planners to sell bank products."
"It would seem that the banks' objective is to be able to sell compulsory super and other products through financial planners and other staff, rather than provide Australians with the impartial financial advice that they want, need and deserve."
"It is simply extraordinary that the banks are seeking a leg up of this size at the direct expense of Australian consumers."
The ISA's report will be presented at today's Senate Economics' Committee hearing into the FoFA streamlining Bill in Canberra.
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