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.

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