The chief executive of the Financial Services Council (FSC) has slammed the federal government's superannuation tax changes by declaring they send the wrong message at a critical time for Australia.
In his address to a joint FSC and Association of Financial Advisers (AFA) breakfast yesterday, John Brogden said any signal to the community that disincentivises them to invest in their own retirement was a bad outcome for Australia and Australians.
"We think this [the government's tax on super] has nothing to do with superannuation policy and everything to do with the government's short-time interests in dealing with the 2012/2013 budget," Brogden said.
"That's all it is and that's the worst way to approach superannuation policy in Australia. I want you to know that from the FSC perspective we will continue to oppose these tax increases and continue to campaign against them.
"This sends exactly the wrong signal at exactly the wrong time."
Late last week, leaked budget papers suggested the Labor government intended to increase the tax on concessional contributions to superannuation from 15 per cent to 30 per cent for people with pre-tax incomes of $300,000 or more.
In his address, Brogden also outlined the FSC's two "headline" concerns regarding the government's Future of Financial Advice (FOFA) reforms.
The two main areas of concern are the lack of reform clarity around issues such as scaleable advice, and the lack of assurance around the best interest duty.
"We've made it very clear that the opportunity to provide scaleable advice in the current legislation does not exist. We do not believe that scaleable advice cannot be provided with any benefit to consumers or the industry in its current form," Brogden said.
He said if a "brave and exciting new world" that flowed out of the advice reforms was a workable regime for scaleable advice, that meant the industry would have a suite of opportunities.
"We have intra-fund advice at one end, full comprehensive advice at the other end and in between the new world of scaled or scoped appropriate advice," he said.
"If we can't deliver that middle mode of advice, there is absolutely no chance that more Australians that presently receive advice will receive advice."
Since the release of the draft legislation, the FSC had changed its position of supporting the legislation to opposing it, he said.
"As it [the legislation] goes through the Senate, frankly with little likelihood of change, we will continue to lobby," he said.
"But it means that we will continue to hold a position in the next government, whichever colour that should be, that this legislation still needs to be amended to ensure that Australians can benefit from the new reforms and benefit in a manner that ensures they can give better advice and more appropriate advice."
The FOFA legislation is expected to be debated in the Senate this month.
