FPA laments confusing FOFA process
The Financial Planning Association (FPA) has renewed its call for the restricted use of the term "financial planner" at the same time as lamenting the degree to which the Government's Future of Financial Advice legislation has drifted away from the bipartisan findings of the Ripoll Review.
The FPA chief executive, Mark Rantall, used an opening address to the Parliamentary Joint Committee (PJC) reviewing the FOFA bills to describe the "dramatic shift" from the original representation and "measures not representative of the PJC recommendations at all".
"The FPA questions this transition, how it has come about, what interests are being served and whether the fundamental objectives and goals of FOFA have actually been achieved," he said.
"It is the FPA's view that the FOFA legislative framework fails to protect consumers from the worst effects of product and gatekeeper failure, will reduce competition especially amongst the independent/boutique groups, and will ultimately increase the cost of financial advice to the average Australian who needs it most," Rantall said.
Further, the FPA chief executive pointed to concerns about the consultative processes which had been employed by the Treasury and the Minister's office.
While acknowledging the FPA's close involvement, he also said that "the process of the reform agenda was never documented, and many decisions were made that caused much confusion to the FPA and the consultation group in general - especially as to how and why certain decisions were made".
"For example, the decision to amend the fee disclosure statement from originally only applying to new clients in the draft legislation to then applying to all clients in the current legislation is a clear case in point," Rantall said. "Similarly, the expansion of Opt-In from within the MySuper framework and extending to all financial advice is another example."
Recommended for you
Financial Services Minister Stephen Jones has shared further details on the second tranche of the Delivering Better Financial Outcomes reforms including modernising best interests duty and reforming Statements of Advice.
The Federal Court has found a company director guilty of operating unregistered managed investment schemes and carrying on a financial services business without holding an AFSL.
The Governance Institute has said ASIC’s governance arrangements are no longer “fit for purpose” in a time when financial markets are quickly innovating and cyber crime becomes a threat.
Compliance professionals working in financial services are facing burnout risk as higher workloads, coupled with the ever-changing regulation, place notable strain on staff.
