Seniors group wants big banks to go to war with Government
OLDER Australians have urged the Big Four banks to "publicly denounce" the Abbott Government's changes to financial advice laws, in light of a Senate inquiry call for a Royal Commission into the issue.
The biggest seniors lobby group in Australia, National Seniors, has written to the chief executives ANZ, Commonwealth Bank, Westpac, and the National Australia Bank on Monday.
While the banks have largely backed improvements the Abbott Government is considering to Labor's Future of Financial Advice laws, they have not criticised worrying parts of the changes.
Critics of the legislation has included seniors groups, the industry superannuation sector and the financial advice industry, on the basis the government's changes could allow questionable commissions and potential conflicts of interest for advisors.
National Seniors chief executive Michael O'Neill's letter to the banks called on them to take the lead, after trust in the financial advice sector has deteriorated since a series of high profile collapses including the Storm Financial breakdown.
He wrote the level of confidence in the sector was "at a very low point and diminishing daily", and that "no amount of spin or gloss...can alter that".
The letter comes after the Senate economics committee, after examining forgery allegations at CBA and alleged failures in enforcement at the companies' regulator, last week recommended a Royal Commission into the problems.
Mr O'Neill wrote the major drivers of the government's proposed reforms were the financial services industry and "major banks" which controlled "more than 80% of the advice sector".
"National Seniors has and continues to oppose the proposed changes because independent legal analysis concludes they provide for substantial consumer detriment," he wrote.
But the call for a Royal Commission has so far met with a lukewarm reception in senior government ranks, with Finance Minister Senator Mathias Cormann committing only that such issues would be looked at in the existing financial services review.
The government is yet to officially respond to the Senate inquiry's recommendations, and despite the concern about its financial advice reforms, appears likely to try to go ahead with the changes.