Australia's economy is set to benefit from the bedding down of the government's financial advice reforms, with the country's financial services industry now freed up to promote itself as a financial services hub.
In an opinion piece published in The Australian, Parliamentary Secretary to the Treasurer Bernie Ripoll said now that the government's Future of Financial Advice (FOFA) reforms are cemented in law, time can be spent on promoting the sector in the Asian Pacific region.
"The nation is in a unique position within the Asia-Pacific, with the chance to be a leader in financial services," Ripoll said.
"We are not trying to compete on the same global footing as Singapore, London or New York, but we don't need to when we can be their equivalent in our own back yard.
"We have the experience, we have the skills, we have the credibility, and now with FOFA we have the legislative and cultural shift to match."
The FOFA reforms provide "the right balance" between appropriate regulation of the financial services sector and empowering investors and consumers, he said.
"The long-awaited and much debated industry-led reforms are now law. It hasn't been easy and nor should it have been. The changes are significant, transforming the way things have been done for the past 30 years," he said.
The legislation has also provided participants in Australia's financial services sector with greater degree of professionalism, he said.
"In principle, FOFA is about having the best interests of the consumer at the heart of the advice model. Advisers must put the best interests of their clients first," he said.
"It is about setting new standards of service and removing conflicted remuneration by banning the payment of sales commissions. Once again, customer needs will be at the centre of advice and security - giving consumers more control of their funds."
Ripoll also praised the industry for its reform efforts: "These substantial reforms could not have been possible without the industry itself.
"The financial services sector has worked hard through its professional bodies to drive change over many years. And the credit to them is well deserved," he said.
In terms of further work, Ripoll highlighted the "stubbornly low" rate of Australians to seek financial advice.
"With survey results from [ASIC] showing that up to 80 per cent of Australians had never used a financial adviser, more has to be done to shift this stubbornly low participation rate," he said.
"Increasing the number of people seeking advice will also boost financial literacy, the key to making sensible investment decisions."
The opinion piece, entitled 'Financial advice reforms put consumers in front' is one of the first public comments Ripoll has made on FOFA since shifting from his chairmanship of the Parliamentary Joint Committee on Corporations (PJC) and Financial Services to his current portfolio.
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