Devil in the detail of FOFA legislation
The Federal Government has injected enough complexity and uncertainty into its Future of Financial Advice legislation that it may not be possible for the industry to implement it by 1 July next year.
That is the bottom line assessment of key participants in a Money Management roundtable in the immediate aftermath of the Assistant Treasurer and Minister for Financial Services, Bill Shorten, introducing the first tranche of the legislation to the House of Representatives.
Matrix Planning Solutions managing director Rick Di Cristoforo made clear during the roundtable that he believed the Government had created confusion and complexity by moving away from the original exposure draft of the legislation.
"By not listening to the industry... they've put in a piece of legislation that is actually not possible to be implemented by 1 July 2012," he said.
"I know we've all got questions about when this thing gets implemented, but even with it in its pre-exposure draft form, we had questions about the implementation," Di Cristoforo said. "I've now got questions about how every single company in this industry actually coordinates together a piece of data on a piece of paper for a new client, when all the pieces of data are in disparate places.
"They simply can't be put together - what we're seeing in the industry right now - and I know that's not a view of just Matrix, that's a view of every single person I've spoken to," he said.
Colonial First State's Nicolette Rubinsztein said she believed the Finance Industry Council of Australia had written to the Government questioning the Government's legislative timetable and seeking more transition time.
Premium Wealth Management general manager Paul Harding-Davis suggested the timeframes being imposed by the Government were also likely to be causing consternation amongst some of the industry superannuation funds seen as the Government's own constituency.
"Given how long it's going to take for final details, for final passage - how few months are left for the industry to wrestle with this - it's kind of alarming, particularly when you think about the sorts of changes you're asking platform providers and super fund administrators to make," he said.
"I find myself a little intrigued, too, about the implications of that - across some of what the Government might argue are their own constituencies - in terms of the effort they would have to go to, to produce this information and to put in place those processes in that same space of time," Harding-Davis said.
"I would have thought that some of them would be alarmed by what they're being asked to accomplish," he said.
AUTHOR
Mike Taylor
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