The Labor Party and independent senator Nick Xenophon say they are willing to extend an olive branch to Finance Minister Mathias Cormann after they successfully disallowed his controversial financial advice regulations in the senate this week.
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A so-called "coalition of common sense" comprising Labor, Greens, independent and other cross bench senators voted on Wednesday night to disallow the Abbott government's Future of Financial Advice regulations in the senate.
The move took the government by surprise and means the industry will now have to return to the former Labor government's Future of Financial Advice laws.
In response, Mr Cormann issued a formal statement saying he did not plan to give up on his reforms and he still wanted to pursue the matter through the senate.
"The government will continue to progress its substantive FOFA legislation giving effect to our improvements through the Senate," Mr Cormann said,
"In the meantime, given the government's FOFA improvements had force of law over nearly five months, I have asked ASIC to facilitate an appropriate transition to 1 July 2015."
But Senator Xenophon said on Thursday that he was "very happy" to talk to Mr Cormann in a "constructive way" about the best way to move the issue forward, including ways in which compromised changes may be made to the existing legislation.
"I want to have a discussion with Mathias Cormann and my crossbench colleagues, including my colleagues from the Greens and the Opposition, who we all banded together on this in terms of coming up with, I think, a good result," he told ABC radio on Thursday.
"The changes need to look precisely at the best interest duty, or the duty to act in the best interests of the client. I think that has been watered down by the government.
"They deny it, but I think an independent analysis shows there has been a real problem there and obviously the government is going on about the whole issue of industry super funds being protected from some of these reforms.
"I'm very happy to discuss that in an open constructive way with the government in order to get a better solution, but ultimately this has to be about the consumers. It has to be about preventing future financial disasters, where many thousands of Australians have already been hurt, devastated financially."
The Labor Party had written to Mr Cormann in July stating its position on a possible compromise – including fixing the so-called grandfathering arrangements in its FOFA laws – and said on Thursday that that position still stood.
"We recognise that there are some minor provisions in the regulation that are beneficial to the financial services sector and where preserving those provisions would not reduce important consumer protections," the letter said.
"Labor would support the government moving an amendment to the disallowance motion to preserve grandfathering provisions at items 28, 29, 31, 32, 33, 34 and 35 in the current regulation."
