Senators deep dive into advice lobbying

Both financial advice lobby groups appeared before the Senate Economics Legislation Committee inquiry into the FOFA amendments yesterday.

Greens Senator Peter Whish-Wilson asked a panel of FPA executives to explain the difference between the groups – particularly given their different approaches to the general advice provisions in the proposed FOFA amendments.

FPA chairman Matthew Rowe said his organisation was a ‘professional body’ rather than an ‘industry body’, and any board decision must be in the public interest – not necessarily the commercial interest of FPA members.

“We have formed views that the commission element around general advice is not in the public interest,” he said.

“Whilst I acknowledge that that may not have been a policy intent and – it’s an issue around drafting – we think it’s something that should be rectified,” he said.

As for the difference between the two organisations, Mr Rowe said that while members of the AFA can also be members of the FPA, “it doesn’t go both ways”.

“To be a member of [the FPA there are] educational standards and other things that would preclude just anyone becoming a member of the FPA,” said Mr Rowe.

“So there are differences between an industry body and what an industry body represents, which is the commercial interest of its members; and a professional body which is there to act in the public interest,” he said.

Asked his opinion about the differences between the two groups, AFA chief executive Brad Fox said there was “actually a fair degree of crossover”.

“There are a number of members that are members of both organisations. So I would say they’re not distinctly different,” said Mr Fox.

“[The AFA] has a designation that our members can achieve; and the FPA has a designation their members achieve. We both have codes of conduct or support structures similar to that,” he said.