Coalition declares approach on grandfathering
The Federal Opposition has signaled the approach it will take to grandfathering in the event it wins the forthcoming Federal Election, with clients ultimately determining the issue.
The Shadow Assistant Treasurer, Senator Mathias Cormann, said grandfathering in relation to a planner's existing clients should not be impacted by changing licensees.
"In relation to existing clients subject to grandfathering, it should be the client's choice that determines the approach. That is, if a client actively changes their arrangements, the Future of Financial Advice (FOFA) provisions should apply," he said.
Otherwise, Cormann said that if the arrangements between a client and his or her planner remained unchanged, then grandfathering should continue where a licensee sold their book of business.
"Any other approach causes inappropriate and counterproductive distortions in the market," he said.
Cormann's comments have come amid concerns that the current grandfathering interpretations being utilised by Treasury would see advisers who change licensees losing grandfathering with respect to existing clients.
Further, any change to that interpretation is dependent upon Treasury changes and ultimate sign-off by the minister.
AUTHOR
Mike Taylor
Recommended for you
Determinations by the FSCP since the start of 2025 are almost double the number in the same period of 2024, with non-concessional contribution cap errors and incorrect advice among the issues.
Whether received via human or digital means, financial advice is reportedly leading to lower stress and more confidence, according to Vanguard.
The new financial year has got off to a strong start in adviser gains, helped by new entrants, after heavy losses sustained in June.
Michael McCorry, chief investment officer at BlackRock Australia, has detailed how investors are reconsidering their 60/40 portfolios as macro uncertainty highlight the benefits of liquid alternatives.
