Older Australians Welcome Increased Consumer Protections And Improved Financial Advice But Better Retirement Income Regime Still Awaits

COTA Australia, the peak body for older Australians, today welcomed stronger consumer protections as a result of the Federal Government’s long awaited response to the Financial Systems Inquiry’s Final Report, but called again for more action to improve the retirement incomes system.

COTA Chief Executive Ian Yates said that Australians would benefit from stronger controls on financial advisors and planners including raising their professional and educational standards, overseen by an independent statutory body, and improving the register of financial advisors to identify who meets these new standards.

“We also warmly welcome the Government’s agreement to legislate to make issuers and distributors of financial products accountable for products and services performing in the way consumers are led to expect; and to give ASIC the power to intervene to modify or ban harmful products that risk significant consumer detriment.

“Older Australians will also welcome measures to improve disclosure of product features, risks and fees and reviews of how fee structures in mortgage-broking and stockbroking affect the quality of consumer outcomes.”

Mr Yates said that legislation to ban merchants from imposing unfair credit card surcharges that bear no relation to the real cost of processing is also good news for consumers, as such surcharges amount to gouging of consumers without any practical means of redress.

In regard to retirement incomes and superannuation Mr Yates welcomed the government’s agreement to legislate the objective of superannuation in legislation; to review the efficiency and effectiveness of the super system; and support the development of comprehensive retirement income products.

“However the detail of improvement to superannuation and other retirement income measures is missing,” Mr Yates said; “We await the release of the also long awaited Retirement Income Streams Review and the Tax White Paper process’s Options Paper.

“If the government had taken COTA’s advice in April 2014 and announced a Retirement Incomes Review in the 2014 Budget it would have been finalised by now and we could have been implementing a more effective, fair and sustainable retirement income system. Instead we wait, and lose ground on essential reforms.

“Overall the government’s FSI response heads in the right direction but there is a long way to go with further consultation, reviews and decisions to be made. Let’s hope these are now made a priority.”

Media contact: Ian Yates 0418 835 439, Olivia Greentree 0439 411 774.

COTA Australia is the peak policy development, advocacy and representation organisation for older Australians, representing COTAs in every State and Territory and through them over 500,000 older Australians.