Shorten rethinking commissions ban

The Assistant Treasurer and Minister for Financial Services and Superannuation, Bill Shorten, has given the clearest indication yet that the Government is prepared to compromise on its contentious proposal to ban commissions sold on life insurance within superannuation.

Shorten says he has been “listening very carefully, and while this is not a definitive statement finally, I am a little more persuaded of the case around risk insurance and the commission where there’s a bit of work actually gone into delivering a product to an individual”.

“I do not see the case for commission on insurance through default or group policies, but I’ve certainly been open and listening carefully to the propositions put around individually-advised risk products in super,” Shorten says.

“The Financial planning Association have been putting up a good lobbying campaign – perhaps in contrast to one other financial planning group and MLC and AMP have been very persuasive.

“So this is not a final issue, but I can certainly see the case around making sure we encourage insurance.”

On another contentious FoFA issue, opt in, Shorten told the Financial Services Council 2011 annual conference on the Gold Coast that the Government remains committed and will “take our chances in the parliament”.

“I’ve seen some numbers that say it’s going to cost $100 every time this transaction takes place – I do not believe that,” he says.

“The idea of opt in is no disaster for the industry.

“That does not mean I dismiss some of the objections [such as] if this is best practice, should you ever regulate best practice? I don’t think it is best practice. I think it’s getting towards better practice.”