Rob Mitchell (McEwen, Australian Labor Party) Share this | Hansard source

I like the member for Forde, but really if he is going to come into this chamber and sit there and use the protection of saying things are facts, when they are allegations, that is pretty poor form. He is better than that. I know some of the Star Wars scene around him is a little bit different, but he is actually better than that. He should not come in here with allegations and make them claims.

These reforms, which the government is bringing in, are nothing but an attack on everyday Australians who have little savings. The purpose of what we brought in was to ensure that financial advisers act in the best interests of their clients—put simply: to make sure that the client is getting the best possible advice for their needs and objectives without being caught up by the adviser. To those of us with strong convictions—which counts out the other side of the House—morals and ethics, to Labor, and to many people, this seems ethical. It seems ethical to make sure that when you go and see a financial planner they are working in your best interests and not their own hip pocket.

The Abbott government is seeking to change this by adding a loophole so that advisers do not have to look after the best interests of their client. I will just state that again to be clear: financial advisers do not have to look after their clients' best interests. And this is considered really good by those opposite. It is absolutely appalling. This means that the average person will visit a financial adviser to seek help on planning for their retirement. But, under Labor, the financial adviser would be required to genuinely determine what is affordable and what is suitable for the client's needs. Under this government, the financial adviser can basically sell the client whatever product he wants to sell and he can pick up the biggest commission he likes, without thinking twice about how that is going to impact on people and their savings.

Speaking of commissions, another reform Labor introduced was a conflicted remuneration This reform banned commissions from being paid to financial advisers by the financial product providers. Again, put simply, it means that financial advisers could no longer be persuaded to spruik a particular financial product, because they knew that they would receive a very healthy commission from it. Removing this temptation to sell a product because of the juicy commission means that financial advisers would offer the most suitable product for their client. But, alas, the Abbott government is removing that. It opens the door to allow the financial advice sector to become a sales push, as opposed to being a life-long, important financial decision-making process affecting those who need assistance.

For example, Joe wants to speak to an adviser about taking out a life insurance policy to look after his family in the event of something unfortunate happening to him. Instead of the financial adviser listing the options best suited to his needs, affordable in his budget, and flexible to his life changes, advisers can simply push for a product that will give them the most sales commission.

Another change Tony Abbott seeks to remove is the opt-in. This reform was introduced by Labor to ensure that clients have to physically opt-in to receive ongoing advice every two years. That means that any fees that the financial adviser is charging to work with the client will need to be mutually agreed to every two years. This prevents advisers from sticking a lifetime of fees onto a client's portfolio, without the person even knowing that it is happening. The Abbott government scrapping this means that most people will pay fees for services they do not get, and some will pay fees without knowing because there is no disclosure, no best interests and no opt-in.

These are examples of how the Abbott government is completely disregarding the needs of everyday Australians, but the Prime Minister is making sure he is looking after his own mates in the big banks. As one of our members mentioned just before, even that great doyen of the Labor Party, the great voice of the socialist left, Alan Jones, got out and said that what this government is doing is wrong. So, being the puppet master, maybe he should pull a couple of strings and get little Pinocchio-Tony to actually back off on this.

In closing, I heard the parliamentary secretary talk about the ABC's Fact Checkand how important it is. So I had a quick look at the ABC's Fact Check. It says: 'Is the government paying a billion dollars a month on Labor's debt?' Fact Check says: 'Exaggerated'. 'Christopher Pyne has claimed that graduates earn more.' Fact Checksays: 'Overblown'. 'Will Australia have the biggest medical research fund?' All overblown, all lies, all puff and all bluff. (Time expired)

Order! The honourable member's time has expired. The member will withdraw the reflection on the minister as lying.

I did not say that he lies. I said 'all lies'. That is what that says there.

An opposition member: They are not lies. They are just—

But I am happy to withdraw for you, Deputy Speaker, just to keep 'Precious' over there happy.

Thank you very much.

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