With a looming election and the government's FoFA reforms under a cloud, a former political leader has offered her predictions on legislative direction.
Financial planners have been urged to continue to put forward their concerns regarding the Labor government's Future of Financial Advice (FoFA) reforms regardless of next month's federal election.
Association of Financial Advisers (AFA) political strategist Kerry Chikarovski told attendees at yesterday's AFA Sydney roadshow that despite the outcome of the 21 August election, concerns around many of the reforms will still remain.
While the former NSW Liberal Party leader said there was no way of knowing at this stage which reforms would be passed as legislation, she offered a breakdown of where the industry may stand based on the government Australia chooses.
"If the Labor party wins then the process we're in will continue. I suspect there will be a new minister - I'm not sure who - but I suspect there will be some reshuffling of the ministry. But the process that [Minister for Financial Services and Corporate Law] Chris Bowen has put in place will continue," she said.
Chikarovski said the most likely scenario after the election is that the Greens will have the balance of power in the Senate.
"If the Greens have the balance in power in the Senate and there are things in the legislation that this industry thinks the government hasn't got right and would perhaps be better improved, then clearly the only option would be to work with the Coalition and Greens to try and make some amendments," she said.
Chikarovski said if the Coalition were to win the election, she believed part of the FoFA reforms would continue.
"I think part of this process [FoFA] will continue because it was a joint parliamentary committee. It was unanimously agreed to, so a number of those recommendations will continue," she said.
While the Coalition is yet to put forward its official views on FoFA - other than to appose a blanket ban on commissions - Chikarovski said fiduciary duty and education is "on the table".
"The question of opt-in, opt-out - I think that's something we would have to have a very strong conversation with the Coalition about, as we're not clear about their view on that at this stage," she said.
"But it kind of figures if they don't believe in legislating remuneration then they won't believe in that, but we need to get some clarity on that."
Chikarovski also predicted that between now and the end of the year, Treasury will draft legislation on the back of its industry consultation that will be put into the public arena in the early part of next year.
"I actually believe this is a genuine consultation process. I urge you to consider how you can be involved in this because these changes that Chris Bowen has put out have the potential to be the biggest changes in your industry in many years - probably bigger than FSR [financial services reform]," she said.
The two non-consecutive alphabetic letters encountered most often last week caused more controversy than the underlying policy they represented, Wouter Klijn writes.... read more »
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