The July 1 implementation date for the Future of Financial Advice (FOFA) reforms will probably be deferred, according to opposition financial services spokesman Mathias Cormann.

“The first tranche of the FOFA bill has now been referred to the Parliamentary Joint Committee on Corporations and Financial Services with no deadline for the report,” he told delegates at the Association of Financial Advisers conference on the Gold Coast last week.

“Our preference is for the report to be released in February, but the Government will want it before Christmas.

“I don’t think this legislation with be with Parliament until February or March, and then we have the Budget.”

Senator Cormann says the second and third tranches of the FOFA bill haven’t been released and will still have to be open for public consultation before they go to Parliament.

“I suspect [Assistant Treasurer] Bill Shorten will have to defer the implementation date for FOFA,” he said.

Senior management at a number of financial services companies spoken to by insuranceNEWS.com.au have expressed serious concern about implementing the reforms by the July 1 deadline, citing the amount of work needed to change software programs in such a short space of time.

The lack of firm proposals in the bills is delaying the start of work on rewriting programs and systems.

Senator Cormann says the Coalition wants to work with the industry to create a fairer set of regulations that won’t include the “opt-in” proposal.

“We need to focus on making advice more accessible and more affordable,” he said. “If the industry does get things wrong, it is incumbent on government to see what did go wrong and how we can do it better.

“As you reflect on what went wrong, it is better to focus on fixing the problems rather than pursuing an internal agenda.”

Senator Cormann accepts there is room for improvement in financial services regulation, and the Ripoll report recommendations delivered an agenda for reform that had achieved bipartisan support.

“But two years down the track, we don’t have those recommendations enshrined in legislation,” he said.

“We have ‘opt-in’ in FOFA, but Ripoll never recommended it. The Government came up with it after the event.

“They are just doing what the Industry Super Network tells them to do. It is a government that doesn’t like small business advisers.”