Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Link to this | Hansard source

My question is to Senator Cormann in his capacity as Acting Assistant Treasurer. The senator may be aware that hundreds of Australians are facing the loss of their homes—indeed, foreclosure today by the ANZ Bank, because they are victims of unscrupulous financial advisers, who leveraged them into risky and complex management investment schemes, such as Timbercorp. Did you meet with any of the victims of the Timbercorp collapse in Parliament House yesterday? And does the Liberal government, the architect of management investment schemes in Australia, accept any responsibility for the catastrophic regulatory and policy failure now surrounding management investment schemes in Australia?

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

The answer to that final question is: no. Let me just make a general point. Here in Australia we have a very good financial services industry. Australian financial products and services performed very well by global standards throughout the GFC. Every now and then, there are bad apples in every industry; whenever there is a bad apple, they ought to be prosecuted and they ought to have the book thrown at them. Our expectation as a government is that—and the regulatory requirements that are in place right now and will continue to be in place in the future require that—financial advisers will act in the best interests of their clients. That is a statutory requirement that was introduced into the Corporations Act with bipartisan support.

It is a requirement that continues to have our support and will have our support into the future. Obviously government cannot be behind every individual transaction in the private sector everywhere across Australia. We need to ensure that we have the right balance between consumer protection, when it comes to our regulatory arrangements, while making sure that access to high-quality advice is affordable.

John Hogg (President) Share this | Link to this | Hansard source

Senator Cormann, resume your seat. Senator Whish-Wilson is on his feet.

Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Mr President, I rise on a point of order: relevance. I asked whether the Liberal Party took responsibility for the catastrophic failure of MIS schemes.

John Hogg (President) Share this | Link to this | Hansard source

There is no point of order. The minister is addressing the question and the minister still has 46 seconds remaining.

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

Thank you. I could not have been more direct in my answer to that question. I said, 'No', right at the beginning to that part of the question. You clearly did not listen to what I had to say. The senator was clearly just jumping up with his pre-organised point of order, making an assumption about what I was going to say rather than about what I actually said. As far as we are concerned, we on this side of the parliament understand that good financial advisers across Australia fulfil a very important role. They help people with their financial health and wellbeing. They help people manage financial risks and maximise financial opportunities. They are dealing with other people's money so there ought to be an appropriately robust regulatory framework in place, but it has to be one where you have an appropriate balance between high level consumer protection— (Time expired)

Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Mr President, I ask a supplementary question. Following on from that answer, given that it is obvious many financial advisers did not have the best interests of their clients at heart, and that the culture and practice—not a few bad apples—of paying commissions on general advice has already forced many Australians, including the Timbercorp victims, to the edge of financial, mental and physical ruin, why is the government now so determined to amend the FOFA legislation to overturn bans on commissions for general advice?

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

Firstly, I completely reject the assertion that 'many financial advisers' have done the wrong thing. There are some that have done the wrong thing and wherever they do, as I said earlier, they ought to have the book thrown at them. But most financial advisers across Australia do a very good job for Australians saving for their retirement every single day.

In relation to the allegation that we were somehow reintroducing commissions on general advice, I reject that out of hand. That is just not true. If you had caught up with developments, you would have read the ABC Fact Check—hardly an apologist for coalition policy—which said, in response to a similar assertion by shadow Treasurer Chris Bowen, that it was 'scaremongering' and that he had his facts wrong. If the senator had done a bit more research when he was putting his questions together he would have found out that that particular assertion is completely false.

Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Mr President, I ask a further supplementary question. I will be pleased when the senator puts his money where his mouth is. When will the government introduce legislation to amend the future of financial advice laws? And will you rule out the use of regulation to ensure that the big banks and financial houses are not forced to comply with the FOFA laws before 1 July?

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

Clearly, again, Senator Whish-Wilson is not following parliamentary procedures all that carefully. In relation to his first question, if he was aware of what was actually happening, he would know that such legislation has already been introduced into the parliament; indeed it has been the subject of a Senate economics committee inquiry, chaired by none other than my good friend Senator Bushby. That committee inquiry reported earlier this week. The government is currently considering the recommendations that were made in that report.

John Hogg (President) Share this | Link to this | Hansard source

Senator Cormann, resume your seat. Senator Whish-Wilson, you have a point of order?

Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Mr President, I believe I am being verballed by the senator. That was not the question I asked. I asked whether he would be introducing legislation—whether he would be introducing regulations if he does not get his legislation through the Senate.

John Hogg (President) Share this | Link to this | Hansard source

Order! Resume your seat. That is not a point of order.

Senator Siewert interjecting—

Senator Whish-Wilson interjecting—

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

I cannot believe that Senator Whish-Wilson repeated that part of the question, because my answer could not have been more directly relevant. I said that that legislation had already been introduced; it is already in the parliament; it is currently before the parliament. There has been a Senate inquiry into the legislation, which reported earlier this week, which made recommendations on what possible adjustments the government might want to consider. (Time expired)