FPA responds to latest FOFA announcements
The FPA speaks for over 8000 financial planning professionals, who in turn safeguard the financial affairs of more than five million Australians.
FPA CEO Mark Rantall said:
“We have worked closely with Government over the past two years to ensure this draft legislation works for both financial planners and all consumers.”
“It should be remembered that the FoFA reforms were aimed at improving the quality and availability of financial advice and we hope this will help restore consumer trust in the financial planning profession,” Mr Rantall said.
“We are further supporting this aim with a national advertising campaign – launched over the weekend – reinforcing the importance of having a qualified professional manage your finances. It positions the FPA brand as a mark of trust for consumers.”
“With only two in five Australians seeking financial advice, it is the profession’s responsibility to improve transparency and access to safeguard the financial future of all Australians.”
“In respect to the details released today, the FPA supports the banning of investment commissions and other conflicted remuneration as this will promote trust and confidence in financial advice and provide a better outcome for all consumers,” FPA CEO Mark Rantall said.
“We released our remuneration policy on banning investment commissions to members in 2009 – well before the issue was raised in the FoFA reforms – and welcome this being enacted under legislation.”
“We also support the banning on soft dollar benefits which further supports our existing joint venture with the Financial Services Council (FSC) – setting an industry benchmark on how alternative forms of remuneration paid by third parties are managed and disclosed.”
The FPA also welcomed the Government’s decision not to ban insurance commissions inside superannuation, having convinced the Government that this would have created a double standard and further worsened the under-insurance problems affecting Australian families today.
The FPA will now review in detail the draft legislation, especially in respect to transition and the practical application of the removal of conflicted remuneration, such as asset based fees on geared investments.
In supporting the draft legislation, the FPA has also called on the Government to provide further clarification on a number of outstanding measures, including:
- Final report on the last resort compensation scheme by Richard St John
- Final report on the advisory panel on standards and ethics
- Resolution on the replacement to the accountants exemption
- FPA’s call to restrict the term Financial Planner