Opposition wants to postpone vote on FoFA bill
Tuesday, 23 September 2014 12:30pm

Labor and the Greens have asked the government to postpone again the vote on the changes to the Future of Financial Advice (FoFA) legislation until the Financial System Inquiry (FSI) releases its conclusions.

"Labor Senators urge the government to withdraw these amendments and work to bridge the widening chasm between the two sides," Labor Senator Sam Dastyari said in a dissenting report of the Senate Economics Committee inquiry into the latest FoFA changes.

Dastyari, who is also the Committee's deputy chair, argued that the FSI is expected to report later in the year, while both the financial services industry and the Australian Securities and Investments Commission (ASIC) remain "under intense scrutiny and pressure-from parliament, press, and the public-to demonstrate that they will not allow unscrupulous advisors to prey on unsuspecting Australians, as they have in the past."

Committee member and Greens' Senator Peter Wish-Wilson tabled a second dissenting report arguing that the FSI is also looking at "consumer protections in the financial industry."

"It is reasonable that this legislation should not be brought to Parliament until David Murray has delivered his report and this legislation can be reviewed in light of his recommendations," Whish-Wilson said.

This inquiry into FoFA was set up in light of the changes proposed by the Palmer United Party (PUP), which struck a last-minute deal with the government in mid-July to avoid a Labor disallowance motion that would have blocked the government's proposed changes.

The inquiry report, signed by Liberal Senator Sean Edwards, argues that "the bill in its current iteration remains fundamentally the same in its intent and effect as the earlier version of the bill."

He said that "that the proposed amendments achieve an appropriate balance between providing consumer protection and sound professional and affordable financial advice."

The new text includes an explicit provision to ban commissions from general advice, amendments to the statement of advice provisions and an extension of the time period within which fee disclosure statements must be provided to a client.

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