Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Hansard source

I thank Senator Dastyari for that question. As much as I hold National Seniors in very high regard as an organisation, they are wrong in relation to this. Our changes clearly do not do that. Our improvements to the future of financial advice laws maintain all of the consumer protections that matter. They maintain the requirement for advisers to act in the best interests of their clients. They keep the ban on conflicted remuneration in place, including in relation to general advice provided by bank employees in the context of product sales.

What we are doing is removing the unnecessary and costly red tape which pushed up the cost of advice, which was imposed by Labor at the behest of commercial vested interests; namely, the industry super funds. An example is the requirement for clients to re-sign contracts with their advisers on a regular basis, imposed on small business financial advisers but not imposed on Senator Dastyari's friends in the industry funds movements. Another example is the retrospective application of an additional annual fee disclosure requirement, which of course we agree with prospectively but not retrospectively.

Also, we happen to think that clients and their advisers should be able to agree the scope of the advice, which is why we have put beyond doubt the capacity of advisers and their clients to agree to the subject matter—which, incidentally, is also something that industry funds are able to do. In fact, under the special deal Mr Shorten did with Industry Super Australia, industry funds can provide advice, general and personal; they can charge for that advice and not disclose the charge for that advice and they are exempted from the opt-in requirement that applies to everybody else. It was a special deal that is completely inappropriate in the circumstances. We do not believe that Australia should be the world champion in financial services red tape. We think we need to have the right balance between appropriate consumer protection and access to affordable advice.