The Opposition has responded critically to reforms to the FOFA legislation that Assistant Treasurer Arthur Sinodinos recently made public.
Both the Shadow treasurer Chris Bowen and shadow minister for financial services Bernie Ripoll have criticised the changes commenting that, “the proposed changes announced by the Coalition government are bad news for investors and people saving for their retirement. As consumers are off shopping for their families for Christmas, the government is focused on unwinding reforms designed to restore faith in and professionalise the financial advice sector and ensure that Australians are getting financial advice that is in their best interests.”
Both minister were influential in the policy behind the FOFA reforms and Mr Bowen argued in a recent Tweet that the amended legislation as proposed by the government will make “another Storm, Westpoint or Trio collapse more likely”.
Not only is the Opposition outspoken in their damnation of the Coalitions’ reforms, Maurice Blackburn, a law firm specialising in class-action litigation with close ties to Labour, has also lambasted the changes with principal John Berrill issuing the statement: The Government’s plan to remove ‘catch-all’ from the best interests duty could water down this essential consumer protection, while the recommended introduction of scaled advice could limit the scope of advice given to clients.” Berrill also reiterated that, “while we recognise that some of the reforms will help to clarify the rights and obligations under the laws for both industry and consumers, there are some changes we believe could seriously weaken consumer protection.”
Regardless of the backlash from the left, it has been reported that many industry stakeholders and commentators have welcomed the announcement as an early Christmas present including industry associations AFA, AIOFP, FPA and industry heavyweights AMP and BT Financial Group both welcoming the changes with AMP group executive, advice and banking, Rob Caprioli commenting that, “helping Australians achieve their life goals is something we are passionate about and these reforms will ultimately help enable more Australians to do just that.”