Finance Minister Mathias Cormann
Finance Minister Mathias Cormann AAP Image - Tracey Nearmy

Vote supports abandoning financial law changes

CONSUMERS could be the big winners of the end of government changes to financial advice laws, as seniors groups, advocates and the member-owned superannuation industry claimed victory on Thursday.

But despite a majority of crossbench senators and Labor voting to disallow the Abbott government's changes to the financial advice rules, the government has vowed to press ahead.

It follows a 10-month campaign among seniors, retirees and the member-owned super industry against the banking industry, which had supported the government's reforms.

In an increasingly divisive debate, consumers faced potential loopholes for their financial advisors to receive confidential commissions for five months.

Consumer group Choice chief executive Alan Kirkland said those loopholes were closed on Thursday, and would allow the advice industry to be on a "more professional footing".

Mr Kirkland, National Seniors chief executive Michael O'Neill and Industry Super Australia chief executive David Whiteley all called on the government to officially abandon the changes on Thursday.

But Finance Minister Mathias Cormann remained wedded to the proposals.

In a statement released overnight he said the vote was disappointing but the government remained committed to the reforms.

Sen Cormann said the disallowance motion was bad news for consumers, which would "increase the cost of financial advice", echoing sentiments from the Australian Bankers' Association's Steven Munchenberg.

Sen Cormann said the corporate regulator was now working on an "appropriate transition" back to the previous rules between now and July next year.