Give FOFA a chance, says Whiteley
Industry Super Network (ISN) chief David Whiteley has urged the next elected government to give the Future of Financial Advice (FOFA) reforms a chance before abandoning them completely.
Speaking at a Money Management/Association of Financial Advisers (AFA) breakfast function, Whiteley said FOFA’s flaws should be debated and potentially ironed out before it is scrapped.
His plea was in response to Coalition’s much-publicised plans to change a number of FOFA elements, including the removal of opt-in, if elected.
“Whatever your view, [FOFA] has gone through fairly robust consultation within the industry and fairly robust public consultation and has got through a hung parliament, it should be given the opportunity to see if it’s an effective mechanism,” Whiteley said.
Opt-in reforms have a “very legitimate consumer protection purpose”, according to Whiteley, and should be preserved in some form.
Meanwhile, concerns from stakeholders about the construct of the best interests test have been taken on board and are close to resolution, he added.
“Let’s have a conversation about [changes] first,” he said, signalling the possibility of further compromise.
However, AFA chief executive Brad Fox said the reforms leave little room for negotiation.
“When things are glaringly wrong you should get to fixing them at the earliest possible moment,” he said.
“The amount being spent in practices on implementing fee disclosure statements is putting practices on the brink of not being sustainable.”
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