FPA and AFA lobby on FOFA key issues
Australia's two major financial planning organisations, the Financial Planning Association (FPA) and the Association of Financial Advisers (AFA), have ramped up their lobbying of the key independents in the House of Representatives in the wake of what they regard as a disappointing Parliamentary Joint Committee (PJC) report.
FPA chief executive Mark Rantall has written to members assuring them "the fight is far from over" and that he and his team will be continuing to lobby both the Government and the independents on key concerns.
He outlined those concerns as being that the current legislation and the PJC's recommendations:
- Do not deliver on the goal of improved access to financial advice, and are particularly without clarity regarding how scaled advice works with best interest legislation.
- Consumers face greater risk with the opt-in renewal notice requirement, as the key protection mechanism to advice and dispute resolution schemes will be removed.
- Additional fee disclosure statements for both existing (retrospective) and new clients are redundant. Fee disclosure obligations already exist for advisers and product providers in disclosing fees to the client.
Rantall's letter said that while the Government was considering the PJC report recommendations, the FPA would be directing its energies towards encouraging them to consider recommendations that would better achieve FOFA's objectives.
At the same time as the FPA has written to members, the AFA has exhorted its members to continue lobbying all parliamentarians, including the independents.
In doing so, it has distilled its concerns about FOFA to five key issues:
- Removal of retrospective fee disclosure requirements.
- Removal of the opt-in obligation.
- Improve the clarity and certainty with the best interests duty.
- Adequately ensure that the ban on conflicted remuneration is not applied retrospectively.
- Delay commencement until the industry can be prepared.
AFA chief executive Richard Klipin has made it clear he believes the tenor of the Government's PJC report indicates it has returned to a harder line on FOFA and that, therefore, any amendments will be reliant on the Federal Opposition and the independents.
AUTHOR
Mike Taylor
Recommended for you
Government has introduced a bill to Parliament to legislate the first stream of the QAR reforms.
ASIC now has a 1:1 ratio when it comes to court success in the enforcement of crypto activities and more action is expected as Treasury seeks to introduce a regulatory framework.
A leading governance body has hit out at “specialist interest groups proposing ad hoc law reform” when it comes to reforms of financial services legislation and believes an independent body is needed.
The release of ALRC’s final report into financial services legislation has highlighted financial advice as a “significant” focus as it seeks to reduce costs and help advisers understand their obligations, alongside the Quality of Advice Review.
