Reforms beneficial, but implementation questioned

Members of the financial services industry regard the proposed reforms package as beneficial, but question its ultimate success, according to the research conducted by RBC Dexia.

Survey participants said the Future of Financial Advice (FOFA) reforms face implementation hurdles, given their size, complexity and the challenges of the current political situation.

Managing director of Australia for RBC Dexia Investor Services, David Travers, said the respondents to the survey had raised the question of when, and perhaps whether, the reforms package would come to pass.

“It would appear to be a missed opportunity for Australia if the present political landscape thwarted the drive for change,” Travers said.

One third of respondents thought complexity of regulation represented the biggest barrier to the implementation of the FOFA package, while 24 per cent were concerned about the sheer volume of the reforms involved.

According to the survey, the Cooper Review will have the most significant impact on the Australian market, “probably because its primary focus is on superannuation provision”.

The most important benefit was seen as increased transparency (28 per cent), followed by increased investor confidence (21 per cent) and efficiency (19 per cent).

RBC Dexia’s survey participants included asset managers, service providers, superfund and private wealth managers, as well as insurance companies.