Editorial: Clouds of doubt loom over FOFA debate

03-Mar-2014

By Kate Kachor

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If last week’s intense Senate Estimates discussion about the future of Labor’s financial advice reforms is anything to go by, Australia’s financial planning sector could be in for a bumpy 2014.

On 26 February, Assistant Treasurer Arthur Sinodinos and Labor Senator Sam Dastyari exchanged barbs over the federal government’s planned changes to the ALP’s Future of Financial Advice (FOFA) reforms.

From Dastyari’s rapid-fire line of questioning to Sinodinos’s hard-line approach and concluding retort that Dastyari wouldn’t lose too much sleep before the FOFA debate reached parliament, the display was proof, in my mind, that FOFA’s passage through parliament could turn into a long and drawn-out production.

A report in The Australian last month adds to this theory.

The article claimed Labor “had the numbers” in the Senate, throwing doubt over whether all or any of the government’s planned amendments would pass.

Labor, of course, has made no secret of the fact it plans to oppose changes to its own legislation. It is the party’s right to do just that, just as it’s the right of other members of the Senate to have their say.

My concern in all this is that what could play out in parliament will be more about political point-scoring than what’s best for the industry.

I hope I’m wrong. I do.

The debate over FOFA has gone on far too long. In my view it’s time both sides of politics did their jobs and agreed on changes for the betterment of the industry and the public.

I think that’s what I find most frustrating about the prospect of a drawn-out debate.

It’s not only the feeling that we’ve been here before, but that common-sense change will be lost in a sea of political rhetoric and chest puffing.

As I say, I hope I’m wrong.

Hopefully common sense will prevail and the outcome, drawn out or not, involves changes that do not negatively impact on the revenue lines of financial planners and paves the way for a greater number of Australians to become more financially aware for their retirement years.

Otherwise, it seems rather unfair that all the hard work, effort and financial investment by industry participants may be at the mercy of parliamentarians, debating each other for the prize of column inches and click-throughs.

The government’s FOFA amendments are expected to be debated in the Senate this month.

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