Labor closer to axing regulation that weakens financial safeguards
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Version 0 of 1. The Abbott government has failed in a bid to delay the parliamentary tabling of its changes to financial advice reforms, with Labor succeeding in a series of procedural manoeuvres that bring the upper house a step closer to striking down the measures. The regulation altering elements of Labor’s Future of Financial Advice (Fofa) reforms was registered to begin on 1 July, but the government was entitled to wait until Tuesday next week to formally table it in the Senate. Opponents of the changes wanted the regulation tabled as soon as possible because the Senate could then vote to disallow it. There is adequate support among senators for striking down the measures amid concerns about the watering down of protections for consumers receiving financial advice. During question time on Thursday the Senate heard allegations that the government had deliberately delayed tabling the document despite giving it to the table office a week and a half ago. The finance minister, Mathias Cormann, confirmed he was holding out to allow briefings for new crossbench senators, who hold the power to decide whether the regulation survives. Just 30 minutes after the government failed in a Senate vote on the abolition of the carbon tax, the crossbench again flexed its muscles by backing a motion setting an earlier deadline for the tabling of the Fofa regulation on Thursday. Crossbench senators Ricky Muir (Motoring Enthusiast Party), John Madigan (DLP), Nick Xenophon (independent) and Jacqui Lambie (Palmer United) voted with Labor and the Greens to order the production of documents, outnumbering the government, which only mustered support from new senators Bob Day (Family First) and David Leyonhjelm (Liberal Democrat). The government maintained that it was not required to table the regulation until Tuesday next week, in line with legislation that sets a deadline of six sitting days. But the government was outnumbered in a second procedural motion shortly after question time, when Labor took advantage of a standing order allowing a senator to demand the tabling of a document quoted by a person addressing the chamber. Labor senator Sam Dastyari said Cormann knew the will of the Senate and was simply stalling. Dastyari read parts of the regulation to the upper house as part of his speech. This prompted a Labor colleague to ask for Dastyari to table the document from which he was reading. The house divided but the government lacked the numbers to block the tabling. It is understood the opposition has been advised that the Senate can now push ahead with a motion to disallow the regulation. Labor is likely to pursue the issue next week. Labor's financial services spokesman, Bernie Ripoll, said the developments were evidence of “a shambolic out-of-control government”. “It won't even table its own regulations. Seriously … we've got to table their regulations,” Ripoll said. Cormann said the government was speaking with crossbench senators about the financial reforms. “I was very conscious of the fact that we had a number of new crossbench senators joining us here this week who had a lot on their plates with the carbon tax in particular, and I was very concerned to ensure that my friends on the crossbench had the opportunity to be properly briefed on what was an important area of public policy,” he said during question time. Cormann did not dispute an account presented by Labor senator John Faulkner, who suggested the government had handed the regulation to the table office on 1 July among other legislative instruments ready for tabling on 7 July, the next sitting day. Faulkner asked: “Is it true that late on Friday 4 July, 2014 a further message was conveyed to the tabling office advising that the Treasury wanted to tabling of the Fofa regulations to be delayed until Tuesday 15 July, 2014, the statutory deadline for tabling?” Cormann replied: “I’m not involved in the specific mechanics of all of that but nothing that Senator Faulkner has said to the chamber is in any way inconsistent with what I’ve said on behalf of the government.” Cormann said he wanted to “brief new crossbench senators in relation to matters that are highly technical and in relation to which a lot of misleading information has been spread in the public domain”. The changes would stop financial planners from having to restate their fees every two years, allow incentive payments for getting people to invest in certain things or sign up to certain financial plans, and remove a “catch-all” in the provision that advisers must act in investors’ interests. |