The government’s proposed Future of Financial Advice (FoFA) reforms have drawn both praise and criticism. Consumer advocacy groups such as Choice have come out in support of FoFA, claiming it will go a long way toward stamping out the provision of biased advice. However, FoFA has drawn heavy fire from the financial planning industry, with the Financial Planning Association claiming opt-in will lead to an increase in administrative red tape for financial planners.
While Minister for Financial Services and Superannuation, Bill Shorten, has indicated that he would reverse a decision to ban commissions on insurance inside superannuation on personal advice, he remains steadfast on the contentious opt-in proposal.
Key independent MPs have also voiced concerns over opt-in – and it is these politicians who could decide the fate of FoFA. Bob Katter has already come out against opt-in, labeling it an “absolutely ridiculous” proposal. Katter has said he will actively oppose it, while other independent MPs have expressed serious concerns about FoFA. The coalition has indicated that it will oppose FOFA, and with key independents yet to be convinced of its value, it is clear that the government faces an uphill battle in getting FoFA across the line.
