Labor’s attempts to overturn the Future of Financial Advice (FOFA) regulations in the Senate have failed for the second time in three months.

Senator Sam Dastyari proposed the disallowance motion last week, finally securing a debate following a series of postponements due to other business.

He told the Senate support for the Government’s changes to FOFA is dwindling.

“On one side we have a government minister who has a coalition on his side that is increasingly dwindling [and] a coalition of groups outside this place from whom he no longer has the support he once had,” Senator Dastyari said.

“Those opposing this Government’s changes include people such as the consumer advocate group Choice and… representatives of pensioners and retired Australians such as the Council on the Ageing and National Seniors. It includes super funds and super advocacy groups, including Industry Super Australia, the Superannuated Commonwealth Officers’ Association and financial counsellors such as Care Financial Counselling Services.”

Finance Minister Mathias Cormann says the changes to FOFA are not as dramatic as Senator Dastyari suggests.

“If you listen to the speech by Senator Dastyari you would think we were going back to the Dark Ages somehow,” Senator Cormann said.

“We are removing the requirement to keep re-signing contracts on a regular basis – because that is unnecessary, additional red tape that imposes a cost.

“The previous government did not do a regulatory impact statement on its changes, but we do know its changes cost $750 million to implement, and $350 million per year, ongoing, in additional compliance costs.

“The changes we have been putting forward are delivering $190 million in savings by reducing unnecessary and costly red tape.”

Senator Dastyari told the Senate even the Financial Services Council (FSC) is ditching its support for the changes.

“The FSC conceded that the financial advice industry needs to take a long, hard look at itself,” he said. “It finally admitted that greater regulation is needed to give consumers confidence in their profession.

“What would we all have given to be on the phone call between [FSC CEO] John Brogden and the minister? The minister has said in this place that it is akin to raising the white flag, that he is disappointed and he thinks the industry should do better.

“I am sure they are not the words he used in that telephone conversation.”

Senator Cormann did not mention in his reply the phone call he made to the FSC before it issued a media release calling for a new body to oversee financial advice (see earlier story).

Senator Dastyari’s disallowance motion was defeated by two votes.