Financial reforms needed for seniors
National Seniors Australia is urging the Federal Government to ensure the rights of consumers are fully recognised, as it seeks to progress its Future of Financial Advice reforms in Parliament this week. Minister Bill Shorten announced the introduction of the Future of Financial Advice (FOFA) changes would be delayed until 1 July 2013.
National Seniors Australia is urging the Federal Government to ensure the rights of consumers are fully recognised, as it seeks to progress its Future of Financial Advice reforms in Parliament this week.
Financial Services Minister Bill Shorten last week announced the introduction of the Future of Financial Advice (FOFA) changes would be delayed until 1 July 2013.
Part of the FOFA reforms is a requirement for financial advisers to renew their arrangements with clients every two years through an ‘opt-in’ provision so that consumers can actively choose continued advice and services rather than unknowingly pay continuing fees/commissions indefinitely.
National Seniors Australia chief executive, Michael O’Neill, said the opt-in provision was a key consumer right that must be maintained in the proposed legislation.
“National Seniors is strongly supportive of this proposal as it goes to the core of the relationship between the consumer and the adviser,” he said.
However, he was convinced this requirement “should not be an annual arrangement between adviser and client”.
“The primary consumers of financial advice are the over-50s as this group seeks to ensure their financial situation is maximised as they deal with the later years of employment when there is a greater reliance on savings, investments and superannuation.
“The ‘opt in’ requirement delivers some scope for consumers to exercise choice and hence market power which is an essential consideration,” he said.
According to Mr O’Neill, National Seniors would continue to lobby government for changes that protect all consumers, especially those aged 50 years and older.
