Superannuation industry raises concerns about reforms
THE superannuation industry has again raised concerns about Abbott government reforms to financial advice rules, after a Senate committee recommended removing conflict of interest regulations.
On Monday night the Senate Economics committee recommended making the government's changes to Labor's Future of Financial Advice reforms.
Despite promises from Finance Minister Senator Mathias Cormann that the reforms were "put on ice" after a backlash from consumer groups, investors and seniors, the legislation has remained largely unchanged.
Senator Cormann backed down after concerns were raised the reforms would allow financial advisers to take concessions from firms for selling financial products to people without telling them of the conflict.
The report from the government-dominated committee was also undermined by a dissenting report from Opposition MPs highlighting the problems.
Industry Super Australia's chief executive David Whiteley said the removal of the consumer protections could result in an extra $7.5 billion cost to consumers over the next 14 years.
He said the division shown between the majority and minority reports proved the "contentious nature of the wind back ... which the banks have been fiercely lobbying for".
"The government must rule out seeking to pre-empt detailed debate of the Bill in the Senate by making regulations in advance of a vote," he said.
Labor senators involved also called on the government to abandon the wind back of the previous government's laws, while being willing to negotiate on "minor and/or technical changes".
It remains to be seen whether the government will continue with the legislation in its current form or not.