Cormann’s call for complete halt on FOFA progress

Minister for Finance Mathias Cormann has halted the progress of the Future of Financial Advice (FOFA) amendments through Federal Parliament, leaving the reforms as they were at June last year. 

Cormann announced to Federal Parliament yesterday afternoon that he would pause the introduction of regulations amending FOFA after last week’s referral of the legislative changes to the Senate Economics Committee. 

The Federal Government stated earlier this year it would amend FOFA via legislation and regulation, with the latter aimed at making initial changes that would be confirmed later by legislation.  

The referral of the legislation and the temporary pause called by Cormann effectively halts any further movement on FOFA and leaves the legislation and financial planners in the situation they in were prior to 20 December when the amendments were announced. 

The Senate Economics Committee was due to report back by 16 June on the FOFA amendments legislation; however regulations that made changes possible in the interim were due to be introduced into Federal Parliament this week. 

Cormann stated the Federal Government was still committed to “implementing the improvements to FOFA laws that we took to the last election as soon as possible”. 

“These election commitments are reflected in the legislation currently before the House of Representatives, which will continue through the normal parliamentary process.” 

Cormann stated the pause was to “enable the Government to consult in good faith with all relevant stakeholders on the FOFA regulations” and it was “committed to the retention of the Best Interest Duty and that we do not intend to reintroduce conflicted remuneration or sales commissions for financial advisers”.