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During a meeting on Monday (8 July), the Finance Brokers Association of Australia (FBAA) and federal Assistant Treasurer and Minister for Financial Services Stephen Jones discussed clawbacks in reportedly the first encounter between industry and a relevant federal minister.
According to the managing director of the FBAA, Peter White, the meeting’s significance “cannot be downplayed” as around 75 per cent of the mortgage and finance broking sector were represented during the meeting.
White added that when Minister Jones was in the opposition during 2022, he committed to the meeting and to having a discussion around reviewing clawbacks, with the consideration of limiting them to one year.
The FBAA presented a new round of submissions in August 2023 to Minister Jones and federal Treasurer Jim Chalmers and hosted a meeting at their office with Finance Minister Katy Gallagher.
“The submissions at that time were regarding clawbacks, net of offset commission payments, APRA buffer rates, bank practices to entice new borrowers, and the need to better define broker eligibility for best interests duty,” White said.
“This week we had open and frank conversations around getting a fairer deal for brokers on clawbacks and net of offset commissions.”
The meeting also held discussions around CDO priorities and outcomes, the Treasury’s engagements on lender settlement repricing 24 hours from settlements, and front book and back book pricings.
The FBAA’s MD said Minister Jones has requested a strategic list of actions and outcomes on these matters, along with other issues that need change to bring more fairness to brokers.
“It was an extraordinary privilege to have the minister come to our office in Queensland and meet with leaders in broking and the FBAA,” White said.
This meeting comes as the federal government announced last month (June 2024) that it will adopt some of the recommendations from the Australian Competition & Consumer Commission (ACCC) Home Loan Price Inquiry.
Speaking to Mortgage Business about the decision, the CEO of the Mortgage & Finance Association of Australia (MFAA), Anja Pannek, said that while the association was “pleased to see the Government take action to improve transparency in financial products and making it easier for consumers to switch home loan providers”, it believed these changes “should go further”.
Pannek said: “The move to require lenders to make home loan discharge forms easy to access is a positive step.”
[RELATED: Government change to discharges ‘doesn’t go far enough’: Associations]
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