Shouting into an abyss – Govt consultations

Mike Taylor

Managing Editor and Publisher

16 February 2026

ANALYSIS

The Albanese Government has done a good deal of consulting on financial services since it first came to office in May 2022 – something evidenced by the fact that there are more than a dozen consultations listed on Treasury web site which touch directly on financial advice and investment.

Scores of submissions have been filed in response to those consultations but precious little has actually emerged in terms of legislation or significant regulatory change. Even in the case of the Delivering Better Financial Outcomes (DBFO) regime the legislative momentum has stalled.

The problem for the Government and, in particular, the Assistant Treasurer and Minister for Financial Services, Daniel Mulino, is that there is clear evidence its lack of action from multiple consultations has contributed to the loopholes which gave rise to the collapse of the Shield and First Guardian funds.

In particular, if the Government had followed the recommendations of the Royal Commission and the urgings of the Australian Financial Complaints Authority, then Managed Investment Schemes would have been included in the funding catchment for the Compensation Scheme of Last Resort (CSLR).

Further, if the MISs were part of the CSLR funding regime, then the guardrails within which they are required to work would have been narrower and more likely to have promptly raised red flag.

The same goes with the Government’s consideration of the “sophisticated investor” regime in circumstances where the Australian Securities and Investments Commission (ASIC) was urging lifting the thresholds. Again, nothing changed.

What is notable about the consultations initiated by the Government around financial services is that you have to go back nearly 18 months to find a consultation where Treasury has actually made public the submissions it received.

Those submissions related to the First Tranche of the DBFO legislation where consultations closed on 8 July, 2024.

When questioned about the timing of publishing consultation submissions during Senate Estimates last week, Treasury officials said it was a matter for the Government.

In those circumstances industry stakeholders might feel they are shouting in abyss.