The Claim
“Took $140 billion out of Australians' superannuation accounts through loosening of consumer protection rules regarding financial planning.”
Original Sources Provided
✅ FACTUAL VERIFICATION
The claim references the Coalition government's amendments to the Future of Financial Advice (FOFA) reforms. FOFA was originally introduced by the Gillard Labor government through the Corporations Amendment (Future of Financial Advice) Act 2012 and became mandatory on 1 July 2013 [1]. The objectives were to improve trust in the financial services sector and ensure availability of high-quality financial advice.
The Coalition government, elected in September 2013, announced changes to FOFA on 20 December 2013, citing the need to "reduce compliance costs and regulatory burden on the financial services sector" [2]. These amendments were implemented through regulations commencing 1 July 2014, though they were initially disallowed by the Senate on 19 November 2014 before being reinstated with bipartisan support through revised regulations in December 2014 and July 2015 [2].
The specific amendments included:
- Removing the "opt-in" obligation that required advice providers to renew client agreements every two years [3]
- Removing the requirement for fee disclosure statements to be sent to pre-1 July 2013 clients [3]
- Removing the "catch-all" element of the "safe harbour" for the best interests duty [3]
- Allowing general advice to be exempt from conflicted remuneration in some circumstances [3]
Regarding the $140 billion figure: No authoritative source could be found verifying this specific amount. Superannuation fees are substantial—Australians paid over $32 billion in fees in 2023 and $10.2 billion in the year ended June 2024 [4][5]—but the specific claim of "$140 billion taken out" through FOFA amendments cannot be verified through government reports, parliamentary records, or mainstream media sources.
Missing Context
The claim omits several critical pieces of context:
FOFA was originally Labor legislation: The original consumer protection framework was introduced by the Gillard Labor government, not the Coalition [1]. The Coalition amended existing legislation rather than creating the regulatory environment from scratch.
Bipartisan support for some amendments: The revised regulations that were ultimately implemented received bipartisan support in the Senate [2].
Policy rationale provided: The government stated the amendments were intended to "ensure the integrity of the financial advice framework was maintained whilst delivering a system that offered affordable and accessible financial advice to the Australian community" [2]. The amendments aimed to facilitate "scaled advice"—limited advice on specific topics at lower cost.
Banking Royal Commission revelations: The 2017-2019 Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry (established by the Turnbull Coalition government) revealed widespread misconduct including fees charged without service and inappropriate erosion of member balances [6]. However, these problems predated the FOFA amendments and occurred under both Labor and Coalition regulatory frameworks.
Source Credibility Assessment
The original source provided is The Herald Sun (heraldsun.com.au), a News Corp Australia publication [7].
Assessment:
- The Herald Sun is a mainstream metropolitan newspaper based in Melbourne
- News Corp Australia publications have been widely documented as having a conservative editorial bias and generally supporting Coalition governments [8]
- The specific article from 2014 appears to be an opinion piece or commentary on superannuation protection
- While a mainstream source, News Corp's political alignment suggests potential bias in framing issues against the Coalition
The use of a News Corp source for a claim critical of the Coalition is notable, as this would typically be unexpected given the organization's general editorial stance. However, without access to the full article content, the specific framing and arguments cannot be fully assessed.
Labor Comparison
Did Labor do something similar?
Search conducted: "Labor government FOFA reforms 2012 financial advice consumer protection"
Finding: The original FOFA reforms were Labor's legislation. The Gillard government introduced FOFA in 2012 in response to the Parliamentary Joint Committee on Corporations and Financial Services' inquiry into financial products and services [1][3].
Key differences:
- Labor implemented the original consumer protection framework including the best interests duty, ban on conflicted remuneration, opt-in obligation, and fee disclosure requirements [3]
- The Coalition's amendments watered down some of these protections, particularly the opt-in requirement and fee disclosure obligations for existing clients
- The Banking Royal Commission later found misconduct occurred under both regulatory frameworks, suggesting the original FOFA protections were insufficient to prevent systemic problems
Comparative context:
Superannuation and financial advice fees have been a long-standing issue across multiple governments. The $32 billion in superannuation fees paid in 2023 [4] demonstrates this is a systemic issue affecting Australians regardless of which party is in government. Both Labor and Coalition governments have struggled to effectively regulate the financial services sector, as evidenced by the extensive misconduct revealed by the Banking Royal Commission [6].
Balanced Perspective
While critics argued the Coalition's FOFA amendments weakened consumer protections [9], the government maintained the changes were necessary to reduce regulatory burden and make financial advice more affordable and accessible [2]. The amendments specifically aimed to facilitate "scaled advice"—limited, lower-cost advice for specific needs.
The subsequent Banking Royal Commission (2017-2019), established by the Coalition government itself, revealed widespread misconduct in the financial services sector including superannuation [6]. This suggests the problems in the sector were deeper than the specific FOFA amendments and occurred under both Labor's original framework and the Coalition's amended version.
The $140 billion figure in the claim cannot be verified through authoritative sources. While superannuation fees cost Australians billions annually ($32 billion in 2023 alone) [4], attributing a specific $140 billion loss to the FOFA amendments is unsubstantiated based on available evidence.
Key context: This is not entirely unique to the Coalition—financial services regulation has been a challenge for both major parties. The original FOFA framework was Labor's creation, and the Banking Royal Commission revealed misconduct that predated and postdated the Coalition amendments.
PARTIALLY TRUE
5.0
out of 10
The Coalition did amend the FOFA reforms to reduce certain consumer protection requirements, including removing the opt-in obligation and fee disclosure requirements for existing clients. However, the specific claim of "$140 billion taken out of superannuation accounts" cannot be verified through authoritative sources. The claim also omits that FOFA was originally Labor's legislation, that some amendments received bipartisan support, and that systemic financial services misconduct occurred under both parties' regulatory frameworks as revealed by the Banking Royal Commission.
Final Score
5.0
OUT OF 10
PARTIALLY TRUE
The Coalition did amend the FOFA reforms to reduce certain consumer protection requirements, including removing the opt-in obligation and fee disclosure requirements for existing clients. However, the specific claim of "$140 billion taken out of superannuation accounts" cannot be verified through authoritative sources. The claim also omits that FOFA was originally Labor's legislation, that some amendments received bipartisan support, and that systemic financial services misconduct occurred under both parties' regulatory frameworks as revealed by the Banking Royal Commission.
📚 SOURCES & CITATIONS (9)
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1
Future of Financial Advice | Treasury.gov.au
Welcome to the website for the Future of Financial Advice (FOFA) reforms. FOFA became mandatory on 1 July 2013 (and was voluntary from 1 July 2012). The objectives of FOFA are to improve the trust and confidence of Australian retail investors in the financial services sector and ensure the availability, accessibility and affordability of high quality financial advice.
Treasury Gov -
2
Future of Financial Advice (FOFA) reforms - ASIC
Fair, strong and efficient financial system for all Australians.
Asic Gov -
3
Corporations Amendment (Streamlining of Future of Financial Advice) Bill 2014
On 4 September 2014, the Senate referred the Corporations Amendment (Streamlining of Future of Financial Advice) Bill 2014 to the Senate Economics Legislation Committee for inquiry and report by 30 September 2014. The Committee intends to table its report on 22 September 201
Aph Gov -
4
Superannuation fees cost us $100,000 - and many don't even know it
New research commissioned by Vanguard Australia has revealed that 61 per cent of Australians do not realise their super fund is charging them multiple fees.
Australian Financial Review -
5
Annual superannuation bulletin - highlights
Industry overview Total superannuation industry assets were $3.9 trillion as at 30 June 2024. Of this, $2.7 trillion (69.1 per cent) was held by APRA-regulated superannuation entities and $990 billion (25.2 per cent) was held by self-managed superannuation funds (SMSFs), which are regulated by the ATO. The remaining $224 billion comprised exempt public sector superannuation schemes ($167 billion, 4.3 per cent) and balance of life office statutory funds ($57 billion, 1.5 per cent).
highlights | APRA -
6
Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry
Wikipedia
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7
Herald Sun - About
Heraldsun Com
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8
News Corp Australia - Media Bias/Fact Check
LEFT BIAS These media sources are moderately to strongly biased toward liberal causes through story selection and/or political affiliation. They may
Media Bias/Fact Check -
9
Three billion per year. How the financial system rips us off
Dud insurance is the tip of the iceberg.
The Conversation
Rating Scale Methodology
1-3: FALSE
Factually incorrect or malicious fabrication.
4-6: PARTIAL
Some truth but context is missing or skewed.
7-9: MOSTLY TRUE
Minor technicalities or phrasing issues.
10: ACCURATE
Perfectly verified and contextually fair.
Methodology: Ratings are determined through cross-referencing official government records, independent fact-checking organizations, and primary source documents.