In less than a month, the Senate Economics Committee will deliver its report on the proposed Future of Financial Advice (FOFA) amendments – changes which have divided opinions amongst various community and interest groups. The objectives of FOFA are to improve the trust and confidence of Australian retail investors in the financial services sector and improve access to advice.
The proposed legislation changes were frozen in March by Finance Minister Mathias Cormann who stated that the hold would “enable the Government to consult in good faith with all relevant stakeholders on the FOFA regulations.” Senator Cormann also confirmed that there were no intentions to alter the best interests duty or to reintroduce conflicted remuneration.
The changes continue to evoke mixed reviews - on the one hand, Australian Super chief executive Ian Silk has said that Senator Cormann’s decision was a consequence of the strong campaign against the proposed amendments which he alleged were moving the legislation away from consumer interest and tilting the balance too much in the favour of the advice providers. On the other hand, Financial Services Council chief executive John Brogden has labelled the decision timely and says he hopes that the freeze would ultimately improve the quality of financial advice in Australia.
The Senate Economics Committee is due to deliver its report on 16 June 2014.
Written by Jan Saddler
Written by Shine Lawyers. Last modified: June 16, 2014.