Luke Howarth (Petrie, Liberal Party, Shadow Assistant Treasurer) Share this | Link to this | Hansard source

I rise to speak on the Treasury Laws Amendment (Delivering Better Financial Outcomes and Other Measures) Bill 2024. While the coalition will not oppose the bill's second reading, it is essential to highlight several critical issues and propose necessary amendments to ensure that the bill achieves its intended purpose without unintended negative consequences.

Firstly, we acknowledge the Quality of Advice Review. We must recognise that this bill represents the first legislative response to the Quality of Advice Review, delivered to the government in December 2022. This review was a significant initiative commissioned by the former coalition government, the Morrison government, aimed at improving the accessibility and affordability of financial advice for Australians that right now is very difficult to get when the cost of living under the Albanese Labor government has gone through the roof.

It is critical to remember that this initiative was driven by the coalition's commitment to ensuring that Australians can access quality financial advice and secure their financial future. However, we have seen delays impact the financial advice sector. We cannot ignore the significant delay in the introduction of this bill. The Albanese government was elected over two years ago, and we're just seeing this now. This delay has caused deep uncertainty and concern within our struggling financial advice sector. I've been hearing this regularly as I've gone to different events and spoken to different financial advisors at the recent FAAA roadshows. They're all struggling, and they're concerned about how long the Albanese Labor government is taking on this—and there's a lot more that they need to do. The minister certainly needs to drive this.

Under the current Labor government, this sector has been burdened with much higher fees, higher taxes and more red tape. How does that help Australians get the financial advice they need right now in May 2024, when many Australians are struggling with the cost of living under the Albanese government? These additional burdens are not just administrative; they have real impacts on the viability of businesses and the quality of service provided to consumers. The protracted delay in responding to the Quality of Advice Review has left the financial advice industry in a state of limbo, facing uncertainty and instability. I'd say to the minister: you need to listen to this sector, listen to what they're saying and help reduce the costs so that more Australians have access to financial advice. It's taken Labor a staggering 16 months to begin responding to the review with no clear timeline for a full legislative response. Instead of using that time to draft considered legislation, the government has failed to get the basics right and is creating more problems than solutions. This has resulted in higher compliance costs and operational difficulties for financial advisors and, ultimately, is making it more challenging for Australians to access the affordable financial advice they need.

Our financial advisors deserve a lot better than what the Albanese government is giving them. They have been calling for reforms that reduce red tape and lower costs. Instead, they have been met with legislation that adds complexity and increases their regulatory burden. This is a consequence of a government that is asleep at the wheel. They're failing to support an industry that is crucial for the financial wellbeing of Australians. It's also an example once again of a government and a minister saying something prior to the election compared to what they're actually delivering today in May 2024.

There have been drafting errors and industry impact as well. Despite this delay, it's alarming to note that the bill in its current form contains several widely publicised and spoken-about drafting errors. These errors could have severe implications, potentially gutting revenue streams within the financial advice industry and making it harder for Australians to pay for financial advice through their superannuation. That's a real concern. That is a real concern because we want to see Australians' superannuation go from strength to strength. We want to see their superannuation increase each year, not go backwards.

Why would a government make financial advice harder to access through superannuation? Why is the minister not listening to the sector in relation it this? Financial advisers are warning me that this legislation will add red tape and drive up costs for customers because it will require the superannuation trustees to check every piece of advice given to members. Keep in mind the strict requirements that financial advisers currently have to meet, the university and tertiary studies that they have to do and the warnings that they have to give all their customers over and over again. Yet now the government wants superannuation trustees to double-check every piece of advice. That seems like additional red tape on superannuation, on advice that's already been given by qualified advisers. It just doesn't make sense. Why interfere? Why make that harder?

This is a consequence of a government that has failed to progress meaningful reforms, creating an Australia that is underbanked, underinsured and underadvised, as the shadow Treasurer so often says. These errors not only threaten the viability of financial advisory businesses but also jeopardise the accessibility of financial advice for ordinary Australians. The government's bungling of this legislative process has created confusion and chaos within the industry, undermining the trust that consumers place in the reliability of financial advice.

Once again, this is particularly concerning at a time when it has never been more important for Aussies, the people who we represent in this House and in the other place, to have access to quality financial advice to navigate the economic uncertainties that we've seen in the last two years and plan for their financial futures. We've seen in the last two years higher rents, higher mortgages, a higher cost of living, higher energy, higher grocery bills and higher gas prices. We have seen all of this. We need to make sure that their financial futures are secure and that they can get the advice that they so desperately need.

It's often lost that the role of capital and financial services is as embedded in economics as butchers, brewers and bakers. The shadow Treasurer has spoken about this a lot. An innovative and well-regulated financial system is essential to Australia's prosperity and to solving our productivity challenge. When we reflect on the productivity boom of the 1980s, 1990s and 2000s, it's clear that reforms to financial markets played a crucial role in supporting that productivity cycle. From floating the dollar to harmonising corporate regulations, these reforms drove innovation, competition and consumer outcomes.

In the context of today's productivity challenge, it is alarming to see the backward steps from the government, including changes to the super tax regime and the company tax regime. These changes create uncertainty and hinder investments for Australians. To drive national productivity and prosperity, we need to remove regulatory roadblocks to good advice, we need better products and we need innovation to support a competitive and dynamic financial services sector. The lesson from the royal commission is clear: the consumer must be at the heart of our financial services sector. They must be at the heart. We're not seeing that from the Albanese Labor government and this minister.

Therefore, the coalition calls on the Albanese government to fix these drafting errors immediately. We must secure the future of our financial advice sector and prevent a scenario where Australians are underadvised, underinsured and underbanked, as the member for Hume has often said. It is essential the government fix the errors in this bill to ensure the bill fulfils its intended purpose of improving financial outcomes for all Australians. It is essential that the government steps up to address these issues without further delay.

The financial advice sector plays a critical role in ensuring that Australians can make informed decisions about their finances, and any legislation affecting this sector must be carefully crafted and error-free. The Albanese Labor government must fix the mess now, as the current state of the bill does nothing but add confusion and burden to an already struggling industry. As highlighted by key industry groups, this bill, in its current form, is a hot mess that fails to deliver on its promises. The Assistant Treasurer has proven to be out of touch, out of depth and unable to deliver meaningful reforms that benefit the financial advice sector—and, by extension, all Australians. I would encourage him to listen to the sector and put the benefit of Australians first: to put the people first.

In conclusion, whilst the coalition supports the intent behind this bill, and will not oppose its second reading, we emphasise the need for urgent amendments to address the current flaws. The government's delay and the resulting uncertainty have already caused enough damage. It's time to act decisively and responsibly to support our financial advice sector and, by extension, the millions of Australians who rely on its services. We stand ready as a coalition to work with the Albanese Labor government to fix these issues and deliver a bill that truly enhances the quality of advice and outcomes for all Australians.

I commend this amendment to the House and urge the government to take swift action to address the issues highlighted. I move:

That all words after "That" be omitted with a view to substituting the following words:

"whilst not declining to give the bill a second reading, the House:

(1) notes this bill is the first legislative response to the Quality of Advice review, which was delivered to the government in December 2022 and commissioned by the former Coalition Government;

(2) notes the significant delay in this bill has caused deep uncertainty for our struggling financial advice sector, who have been slugged by higher fees, higher taxes, and more red tape under this Government;

(3) notes that despite this significant delay, this bill has several widely publicised drafting errors that would gut the financial advice industries revenue streams and make it harder for Australians to pay for financial advice through their super; and

(4) calls on the Government to fix these drafting errors without delay to secure the future of our financial advice and prevent a future where Australians are under-advised, under-insured, and under-banked".

Ross Vasta (Bonner, Liberal Party) Share this | Link to this | Hansard source

Is the amendment seconded?

Angus Taylor (Hume, Liberal Party, Shadow Treasurer) Share this | Link to this | Hansard source

The amendment is seconded.

Patrick Gorman (Perth, Australian Labor Party, Assistant Minister to the Prime Minister) Share this | Link to this | Hansard source

I move:

That the debate be adjourned to a later hour this day.

Question agreed to.