Mathias Cormann urges FOFA delay
The Minister for Financial Services and Superannuation, Bill Shorten, has allowed his friends in the union-dominated industry super funds to hijack the Future of Financial Advice (FOFA) reform agenda, according to shadow Assistant Treasurer Senator Mathias Cormann.
At the same time as calling on the Parliamentary Joint Committee (PJC) reviewing the FOFA bills to "sort out Shorten's FOFA mess", Cormann said the minister also needed to immediately announce a delay in the legislation implementation date well beyond 1 July, this year.
Timing his statement ahead of the beginning of public hearings by the PJC in Sydney this week, Cormann said the committee's activities provided an important opportunity for all stakeholders to expose the many flaws in the current legislation.
He said this would help force the Government to make some necessary changes before the legislation passed the Parliament.
Cormann claimed the FOFA legislation had gone well beyond the recommendation of the Ripoll Inquiry and would impose excessive and unnecessary additional red tape. This would unnecessarily push up costs for both financial services businesses and for consumers.
"The current version of FOFA would make us the world champions in financial services red tape," he said. "That is not something we should aspire to."
Cormann claimed the minister's own Explanatory Memorandum had suggested the FOFA changes would cost 6,800 jobs in the financial services industry.
He pointed out that according to the Government's Office of Best Practice regulation, the legislation breached the Government's own best practice regulation requirements.
"Furthermore, many parts of the current FOFA Bills are poorly drafted, creating more uncertainty and the potential for unintended consequences," Cormann said.
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