New government's FoFA fix-list

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While in Opposition, the Coalition showed a strong understanding of the financial advice industry, and the AFA is counting on this to continue.

The association has congratulated the incoming Prime Minister and the Federal Coalition on their success, but has cut straight to the point about what they want the new powers to work on.

“We will be particularly interested in the Government’s approach to improving the effect of the Future of Financial Advice (FoFA), Stronger Super and Default Super reforms,” said AFA CEO Brad Fox.

“The AFA strongly supports the consumer benefits associated with FoFA and we are looking forward to the Coalition’s promised roll-back and amendment of parts of the legislation which will eliminate much of the red tape associated with the reforms, improve the effectiveness of the financial advice industry and help advisers deliver quality, cost-effective advice to Australians,” Fox said.

At the top of the FoFA fix-list are the problems with grandfathering rules, which have reduced competition in the advice market and the ability for advisers to change licensees.

The AFA is looking to solve this as soon as possible, and will also seek a solution to allow corporate super advisers to both recommend a fund and continue to service the fund.

The Corporate Super Specialist Alliance (CSSA) already raised concerns regarding corporate advisers’ restriction under new Stronger Super reforms, to the former financial services Minister, but will have to renew its plea.

FPA CEO Mark Rantall has also congratulated the Coalition on its significant win and is looking forward to working with a new government.

A key focus for Rantall first of all will be the removal of opt-in provisions.

“The opt-in provisions will come into effect 1 July, 2015, so changes need to be made before that date,” he said. The FPA will also be pushing for simplification of fee disclosure statements, which are currently causing members a great deal of concern.

In April, Senator Mathias Cormann said he already had about 50 amendments to the legislation, drafted and ready to implement. The Coalition also made public 16 recommendations on how FoFA could be improved.

Since the naming of the new Ministry, it will now fall on Joe Hockey, Arthur Sinodinos and Steven Ciobo to implement the new reforms.

What would you like to see as a top priority for the government? Share your opinion below.

More stories:

Coalition already prepared for FoFA take-over

More advisers out of pocket

Financial planning's biggest threat

  • Eric Taylor, CPA on 9/09/2013 9:40:44 AM

    The new penalty system for Trustees of SMSFs was not passed by the Senate before parliament was prorogued. I believe this was a positive move on Trustee responsibility.

    What is the new Government's position on this and will the bill be re-introduced?

  • Mervin C Reed FChFP on 9/09/2013 10:44:45 AM

    The ludicrious and costly to consumers fee statements should be dumped as the clients already get these from super suppliers and platform managers. The FDS was just another thought bubble from the Industry Funds and given the ASIC to implement. Looks like ASIC is going to have a lot of stuff to junk and so they should.

  • GAB on 9/09/2013 11:05:31 AM

    Some of ASICs senior staff should be junked. All past Labor members and ex Societe Generale staff should go first. Time for some fresh thinking.

  • Alan on 9/09/2013 11:21:11 AM

    Firstly, thank goodness the nightmare and chaos of t he past 6 years is hopefully all over. Many thanks to all my colleagues and others who voted for some stable government and some sensible policies. Now it is up to the new minister to identify and eliminate with the help of the Parliament the parts of FOFA that serve no purpose in improving the advice process we have to go through. Basically less government and less red tape so that we can get on with it in a professional manner.

  • Ben on 9/09/2013 11:42:31 AM

    Oh look! Something we, as an industry, aren't used to......change. Just another day in paradise.

  • James Smith on 9/09/2013 5:17:12 PM

    I would like to see the government prioritise job creation and acknowledge financial planning is a personal service that is severely compromised if institutionalised.By supporting the small businesses that are the cornerstone of the financial planning advice industry service standards can be maintained and jobs created.

  • Mark Thompson on 12/09/2013 12:15:51 PM

    I would like to see the junking of the 10% super rule restriction that was introduced to eliminate competition for Industry Funds when SG first came on the scene. With concessional caps who cares how you hit the caps limit; just top up when are how it suits you. Also opening up Industry funds to the payment of adviser fees to ALL advisers from the client account would be of benefit to the fund member and their adviser.

  • Alistair on 16/09/2013 11:00:09 AM

    I would like to see Opt in being thrown out and a simplified Fee Disclosure Statement to be provided by the funds and not imposed on us as advisers. We do not have the capacity to handle such nonsense and duplicated processes are a waste of time.
    I would also like to see the ISN being bought into line and investors money not being used for advertising purposes as this is not part of the rules of a super fund under the sole purpose test.
    By all means protect consumers and encourage disclosure but do so without causing harm to business owners such as us in the FP world and reduce paperwork in our industry.
    Labor, the Greens and their puppet masters the ISN have not got a clue and are merely interested in pushing their own barrow.
    We need leadership not more bumbling nonsense such as that of the last 6 years.

WP forum is the place for positive industry interaction and welcomes your professional and informed opinion.

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