STUART NASH (Labour) Link to this
It is a little bit difficult when one finishes at 10 o’clock at night and then starts again at 9 o’clock the next morning. However, what I was saying at 10 o’clock last night is that I am very supportive of the Financial Service Providers (Pre-Implementation Adjustments) Bill. In fact, I think it is very necessary, because what we have seen, with the collapse of the finance companies, is that many, many ordinary New Zealanders have been ripped off and basically taken to the cleaners by a whole raft of people masquerading as financial advisers. I was talking about brands like Colin Meads and Richard Long, who were out there touting for these services. They were iconic brands and very good at what they did, but they knew absolutely nothing about finances. I was speaking to someone last night, after 10 o’clock, who said to me that she invested in Hanover Finance because of Richard Long. Here was a man who stood for integrity and trust, and who was in our living rooms nearly every single night. So if Richard Long said it was good, therefore it must be good!
Hone HarawiraIt must be good! What happened, of course, was that it was not good, at all. Richard Long was a very good newsreader, but he knew nothing about financial advice or financial investment. I hope, with this sort of financial crisis, that iconic New Zealand brands will think very carefully before they start endorsing products that they know nothing about.
I was also talking about Mark Hotchin’s $30 million house, which was built on a graveyard of the shattered dreams and broken promises of thousands of New Zealanders. If that man has any sense, he will not return to this country. It is obscene that we see him at the moment holidaying in Hawaii, off the money of thousands of New Zealanders who are now broke. I cannot imagine, having worked all my life, reaching the age of 65 or 70 and waking up one morning to find that all my savings had just disappeared. How heartbreaking would that be? In fact, there is evidence out there that ordinary New Zealanders have committed suicide over this. They have got to the stage where there is nothing worth living for. All their savings have gone, not only for their own retirement and their grandkids’ education but also to allow them to live and retire with dignity. They have to sell their houses, they have to sell all their assets, and they find themselves with nothing. This is why the legislation that this bill amends is so good. The original legislation was introduced by the Hon Lianne Dalziel, and no doubt she will talk about that a little bit in the future.
This bill will not stop the sort of obscenity that is Hotchin’s extravagance, or stop Colin Meads saying that an investment is as “safe as houses”. However, it might mean that the type of person who was promoting Hanover Finance as a safe investment would disappear. Real financial advisers will be able to scrutinise investment prospectuses with more rigour and in more detail, as is required, I would have thought, by such a profession. The reason I say this is that the intent of this bill is to provide for responsible regulation of the financial services sector and robust consumer protection, in order to restore confidence and trust in the financial services sector. I do not think there would be a person in this House, or anyone watching around this country, who would not agree that this is necessary.
Kiwis need to know that when they take their hard-earned money to a financial adviser they will get independent, competent advice from a person who will walk them through the alternatives and know what they are talking about. When we go to a lawyer, we expect legal advice. When we go to an accountant, we expect that person to be qualified and to give us good accounting advice. When we go to a financial adviser we expect that person to be versed in the ways of financial advice and to give us good advice around that area. The past of the Wild West, a city full of cowboys, was not a good place for the vast majority of Kiwis, and I hope those days are now gone.
As a collective, we need to encourage people to invest in a diversified portfolio, into the productive economy. We need financial advisers to be well versed in the various options. I would say there is a long way to go before the industry has the full confidence of the investing and saving pubic again. But this bill, along with Lianne Dalziel’s two Acts, is a start at least. I hope when this legislation is passed, in line with the other two Acts I have talked about, that at least we will begin to see confidence and rebuilding begin, with New Zealanders once again able to begin to invest with confidence. That is why I am fully supportive of this bill, and I commend it to the House.
DAVID CLENDON (Green) Link to this
Ata mārie. The Greens are pleased to support the Financial Service Providers (Pre-Implementation Adjustments) Bill through a further stage. We do so with some regret. We regret the necessity for such a bill. One would have thought and hoped that, in an ideal world, amendments of this nature would be unnecessary, that people in the financial industry giving advice to often ill-informed laypeople would have a moral compass, and that their own integrity would determine that they actually gave good, honest advice and protected the investments and assets of normal New Zealanders. But, clearly, that is not the case.
I doubt whether anyone in the House does not have someone in his or her close circle of friends or family who has suffered some loss as a result of what has been quite well described as a Wild West, cowboy approach to financial investment, which we have seen far too much of over the last couple of years. I myself and my extended family know of a young couple who had accumulated a small nest egg that would have been a deposit for their first home. That is gone. The reason it is gone is that they quite wisely invested in two companies—companies that apparently were very sound, and whose advertisements on television were fronted by well-known figures. That money is now gone. Basically, they discovered they had invested in a daisy chain of debt speculation and overstated values that were not really there. Essentially, their investments were simply taken away by people too greedy and too venal to be honest and up front about what was going on.
It is really critical that we restore people’s confidence and trust in the notion of investment. People need to know that investing is reasonably secure, notwithstanding that there will always be some risk. That confidence has been comprehensively lost as a result of the rorts, the dishonesty, the greed, and the misrepresentation that we have seen far too much of for far too long. Restoring confidence is critical not least to the business sector. It is important that New Zealand business has access to capital, and small to medium sized enterprise in particular are identifying that as one of the issues confronting them. Access to capital is an issue. We need to encourage people with capital to think that it is a safe bet to invest, and to have a reasonable expectation that that money will be secure.
I have to say that the select committee process, for me as a relatively new member, was a very positive process. That quite contentious and complex technical issues can be resolved to the satisfaction of people with quite different ideological positions demonstrated the power of select committees. I acknowledge the chair of the Commerce Committee, Lianne Dalziel, who had a very useful focusing mechanism. She kept using a phrase along the lines of “What is the harm we are trying to remedy?”, which was actually quite a good strategy to keep bringing us back to the point of asking what the problem was, what we were trying to resolve, whom we wanted to capture, and whom we did not want to include in the provisions of this bill. As a result of that, organisations like credit unions—which are very robust, reliable, and straight-dealing organisations—are not unwittingly caught up within this legislation. We are not imposing compliance costs on organisations or, indeed, individuals who were not targeted because they have not displayed the sort of bad behaviour we are endeavouring to overcome here.
Organisations like the Citizens Advice Bureaux made very good submissions, identifying one or two instances where potentially they could have been captured by the provisions of this bill. Clearly, not-for-profits like the bureaux were not the target; if they give incidental advice in the course of assisting people in the community, that is well and good; the exemption of not-for-profits is a very sensible and strengthening provision of this bill.
There was discussion, for example, about what constitutes a sophisticated investor, recognising that we do not need to put many protections around people who are perfectly able to look after their own interests. Some useful and informed commentary—and, indeed, submissions—from individuals and organisations helped us define whom we were trying to protect, and who can actually look after their own interests and be left to get on with it.
That is probably as much as I want to say at this stage, except to reiterate that the Greens support this bill and its intention, and we look forward to seeing it progressing, and to securing and protecting the investments of people who can expect much better and more reliable advice as a result of this legislation. Kia ora.
Hon LIANNE DALZIEL (Labour—Christchurch East) Link to this
I am pleased to be able to speak to the report back and second reading of the Financial Service Providers (Pre-Implementation Adjustments) Bill. When the bill was first introduced, I said I was pleased that the Minister had indicated his determination to stick to the time frame that he had announced for implementation. As a result of listening to submissions, we have accepted the Minister’s decision to extend the time frame, not so much for the registration as for the implementation in its fullest sense, post - 1 December right the way through to the end of June next year. I also felt that the proposed changes, when they were introduced, were in line with the principles and the intention of the legislation, which I oversaw as the then Minister of Commerce. It was not until I actually started the somewhat arduous task of reading the submissions that we had received—and we received a significant number of very, very detailed submissions—that I realised there were flaws in the original framework that I had introduced that I had not been aware of as the then Minister, and that clearly the present Minister had not been aware of, either.
Just to put what the Commerce Committee has done with regard to this bill—because it is virtually a re-write of the bill that was introduced, and we need to offer an explanation for that—I want to go back for a moment to the pre-2008 election period. In so doing, I confess to the House something that I have confessed to my colleagues—that is, I know more about the intricate detail and the potential application of this bill now, as chair of the committee, than I did when introducing the original legislation as the then responsible Minister. I think there is a reason for that, which I think should be addressed, and I will come to my suggestion about that later on. What I will propose, though, in this space is possible only when a non-partisan approach is able to be achieved. I think that the present Government when in Opposition, and now the reverse—the present Opposition when in Government—proved that a collaborative approach is what is required and produces the best results. I think this bill and the work that we have done on the select committee demonstrates that, and I pay tribute to all of the committee members for what we have been able to achieve on a collaborative basis.
Returning to the pre-2008 period, I know that as the then Minister I put pressure on Charles Chauvel, who, at the time, was the chair of the Finance and Expenditure Committee. I put pressure on him because I wanted those bills back in the House in time to be passed before the 2008 general election. There were two bills that I wanted back, in particular. They were the bills in my name, but also the bill to provide proper prudential supervision for the non-bank deposit-taking sector, which, of course, had transferred to the name of the then Minister of Finance, the Hon Dr Michael Cullen. In many respects, I did not mind if the legislation was not perfect, and I kept saying that to Charles Chauvel at the time. That was because there was time post-election to undertake any remedial work that needed to be done, while getting on with the job of establishing the regulatory frameworks for the new supervisory and dispute resolution regimes to cover what was an under-regulated sector.
I just want to use the word “under-regulated” again. This was not a totally non-regulated sector, but it was under-regulated, and I think that was the critical problem. I know that a lot of people have wanted to put blame on those who were responsible for the regulatory frameworks over probably a couple of decades since the stock market crashed in 1987, if we really want to go back to when we were first alerted to the problems that we have to confront today. But the problem was that there were regulatory provisions in place, and they offered insufficient protection. I think that our committee has been quite good at getting to the bottom of some of the things that we have not been able to get to the bottom of before. We have an inquiry under way that will continue to work to find those essential gaps in our system, and hopefully it will make recommendations to resolve them.
That was why I wanted the legislation passed before the election. I wanted the work to continue in the period when we went off to do our job applications for our triennial job interview, which is, I guess, what a general election is. I wanted to make sure that the bills were not left at the select committee or remained on the Order Paper past the House’s rising for the election period, because nothing would have happened for a very long time if that had been the case.
If there is a criticism that I have of the current Government, and there is one, it is that—
Hon LIANNE DALZIEL Link to this
—no—this bill should have been introduced last year. That is the only criticism I will make. If it had been introduced last year, we would have had much more time to spend on the detailed analysis that we have had to undertake. I know that members of the committee, our advisers, our clerks, the officials, and the Parliamentary Counsel Office were all under pressure. But the pressure that we were under pales into insignificance in comparison with the impact that the time frame had on the finance sector, and the finance sector is critical to getting this legislation right. So I pay tribute to the extraordinary efforts that the major stakeholders went to in order to meet the extremely tight deadlines that we imposed on them. We know that people worked over weekends and that people worked overnight, in some cases, in order to meet these time frames and to deliver what I believe is now much more like the framework that I envisaged 3 years ago, when I announced the decisions made by Cabinet back in 2007. Less than a month before Bridgecorp failed, I made those announcements, and then the domino effect started again. We had had the three failures in 2006. Bridgecorp was really the tipping point, as we saw finance companies fall over one after the other. That was what the committee returned to in the end. I acknowledge my colleague David Clendon from the Greens for commenting on that.
The committee came back to a very fundamental question: what were we trying to do? We brought that perspective to what we were doing. We asked what the risk was that we were trying to mitigate, what the mischief was that this bill was trying to remedy, and whether the regulatory response was proportionate. We came up with a mixed set of answers, depending on whom we were talking about. The legislation is fundamentally about protecting unsophisticated investors. I know that among some of the mum and dad investors, as they are called—or, probably more aptly in some cases, nana and grandad investors—there was a kind of resentment that the language used implied that they were unsophisticated or naive, but I reject the view that these were greedy investors, as some have said. I want to place on record my abhorrence of the practice of deliberately hiding the level of risk behind a lower interest rate than was required to reflect the actual risk that they were taking with their hard-earned money. People lost their life savings in circumstances where they did not realise the level of risk that they were taking. There was a lack of knowledge and a reliance on financial advisers.
Our driver as a committee became a single-minded focus on the mischief that we were seeking to remedy. That is why we divided category 1 and category 2 products more appropriately, defined financial advice more clearly, incorporated the concept of personalised financial advice, and tied financial planning to the risk related to investment. We carved out the wholesale clients, who can look after themselves, and we tidied up the qualifying financial entity provisions. All the committee members worked hard on this bill, and I thank them for that work. In the same way that I have acknowledged the stakeholders, I also acknowledge our committee clerks, our advisers, the departmental officials, parliamentary counsel, and the Minister of Commerce and his staff—his private secretary and his adviser. Finally, I acknowledge this House for allowing us to do things differently from usual, such as granting us leave to provide the departmental report to stakeholders during the time before we had reported back.
This has been a very good process. It has been a hard process, but it has been made very clear to me that we do need to take up the option of exposure draft bills accompanying discussion documents at a much earlier stage, so that the people who work at the coalface are able to give us very direct advice about how legislation will be implemented. In fact, they have made it clear to us that they could not have known these things in advance. We have, I think, made this bill much better, and I commend its passage through the House.
MELISSA LEE (National) Link to this
It is a pleasure to rise to speak on the second reading of the Financial Service Providers (Pre-Implementation Adjustments) Bill. Thousands of Kiwis have been affected by about 30 finance company failures in the past 4 years. That led to a loss of confidence in the financial services sector, and this bill seeks to amend the Financial Advisers Act 2008 and the Financial Services Providers (Registration and Dispute Resolution) Act 2008 in order to give back the confidence to consumers so that they can once again feel secure and place their trust in the financial services sector. This sector is vital in raising capital for businesses. Getting ahead as a nation economically could well mean our having to get the confidence of the mum and dad investors back on dry ground once again.
It is not often that I agree with the Opposition, but it was a pleasure listening to the chair of the Commerce Committee, Lianne Dalziel, speak earlier, and I agree with her that a lot of hard work was put into this bill by the select committee. I would like to acknowledge the chair, Lianne Dalziel, who just spoke, and the deputy chair, Sam Peseta Lotu-Iiga, who made an amazing contribution during this process. For someone like me who does not come from the finance sector, and often even the acronyms meant nothing to me, it was bloody hard work—sorry; my apologies. It was amazing learning from them, and even Lianne Dalziel admitted that she found out more about this bill, and the processes, and the sector, as the chair of the Commerce Committee than she ever did as the Minister of Commerce. I would like to acknowledge the Minister for having the foresight to bring this bill to the House to see it through its passage, and also, like Lianne Dalziel, I acknowledge all the officials, because they have put in amazing work. As she said, we have demanded so much from them, with sometimes overnight report-back time frames, which has been quite tough on them, I am sure. I acknowledge all the clerks, the Parliamentary Counsel Office, and everyone who has helped us through the process.
During the select committee process we had some major discussions about the shape this bill needed to take, but the thing we always came back to and focused on was to always remember that this bill was designed to protect the unsophisticated investors, the mums and dads, and the retired grandmother who wants to invest so she has a little something to leave as a legacy for her grandchildren. Often they really have no idea where to start when it comes to investments. These are the people who lost money as the result of finance company failures—quite a lot of money. They could have really used some sound financial advice, and this bill addresses that issue.
As a committee we considered a large volume of things in this bill, but one of the things I found very interesting—and I am sure we will discuss it further when we go into other stages of this bill—was the definition of financial advice. We were looking to protect unsophisticated investors, so we initially got to a point where we wanted to make sure that everything was captured. It got to a point that even a discussion in a taxi on my way to the airport, or headed to Parliament, about thoughts on whether to invest in or out of the housing market, could have been construed as financial advice. A group of friends sitting around a dinner table discussing the merits of a financial institution could also have been deemed to be financial advice.
The focus of the select committee was to protect the unsophisticated investors, but at the same time to provide clarity to the definition so that there was no question as to what financial advice is, and who is providing the service. So it was very pleasing, and I am sure there would have been a lot of people who were concerned they would be captured by this legislation who made amazing, very technical, and very detailed submissions to the select committee. Only those people who provide financial adviser services in the ordinary course of their business, and those who provide advice in the course of another financial service, are captured by this. This means that advice provided incidental to other services, as with the taxi driver I mentioned before, are excluded. Also excluded is advice on the procedures for the acquiring and disposing of financial products. Also, budgeting services are often called financial planning services. So to make sure there is no confusion, we have changed the wording in the bill to “investment planning service”.
The other issue I found very interesting was the need for authorisation. However, if we authorise everyone, the compliance costs and the stress on the sector would be quite phenomenal. As a select committee, we considered that there was no real need for advisers who work only with category 2 products, like mortgages and insurances, who work for a qualified financial entity—a QFE. They can do this job without the need to be authorised. They can still become authorised financial advisers should they so wish.
The best thing about this bill is we are giving more power to the Securities Commission. The commission will now be able to ban people for up to 10 years by way of an application to the courts. They have the power to declare that a product of a qualified financial entity must be sold only through individually authorised financial advisers. Before an entity is provided with a qualified financial entity status, it must demonstrate the capacity to comply with the regime. This means that the commission does not have to vet every single product a qualified financial entity sells, but will allow the commission to step in under exceptional circumstances when there is trouble.
The expanded powers given to the Securities Commission will go a long way to enhancing consumer confidence, which has taken a major setback. It will promote more professionalism from the sector, and the serious deficiencies we have seen in the financial advisers industry in terms of disclosure, competence, and independence will surely improve. I commend this bill; it is a great bill.
CLARE CURRAN (Labour—Dunedin South) Link to this
The Financial Service Providers (Pre-Implementation Adjustments) Bill is a very important bill, and it is a very good example of how well parliamentarians can work together swiftly to address a critical issue. The issue is to protect ordinary investors—mums and dads—from shonky and irresponsible financial advice, to provide responsible regulation, and to restore confidence in the financial sector. I am very proud of the work that was done by the Commerce Committee and all of the officials involved. I acknowledge up front the incredible amount of work that was done by the members of the committee, particularly the chair, the Hon Lianne Dalziel, the deputy chair, Sam Lotu-Iiga, Katrina Shanks, and my colleague Charles Chauvel, and I thank them for their hard work on this bill. I also acknowledge the long-suffering officials, the clerks, parliamentary counsel, and the work done by the Minister to move this bill ahead.
Over the past 4 years millions of dollars have been lost as a result of about 30 financial company collapses, and www.interest.co.nz estimates that up to 200,000 depositors have been affected. Although this may include double-counting—some of those people may have invested in more than one company—even if it is 100,000 people, that is an awful lot of people who have been affected. Many of those investors made their decisions based on faulty advice from financial advisers. This bill will not stop all of those obscenities, such as Colin Meads saying that Hanover Finance was “safe as houses”, when clearly it was not, but it might mean that the types of people who were marketing and promoting Hanover Finance as a safe investment will disappear. The issue of truth in advertising kept coming up over and over again when submitters came to the select committee. We heard that the advertising was clearly opposite to the reality. Real financial advisers will now be able to scrutinise investment prospectuses with more rigour and more detail, as is required, I would have thought, by such a profession.
The intent of this bill is to provide for responsible regulation of the financial services sector and robust consumer protection in order to preserve confidence and trust in our financial services sector. I do not think anybody in this House or anyone who is watching would not agree that that was necessary. I will mention one particular recent case study. Jailed Timaru investment adviser Neville Cant was banned from operating as an adviser or investment broker for 5 years. The ban under the Securities Market Act was the automatic result of Cant’s conviction for theft of $100,000 by a person in a special relationship, theft from clients, and two charges of forgery. Cant was sentenced on those charges and Securities Act charges in early June. He received a 14-month prison sentence on the theft charge and was ordered to pay reparation of $100,000, and a concurrent 10-month sentence on the two forgery charges. He was also fined $136,000 on six charges laid under the Securities Act in relation to charges of offering and allotting securities to members of the public without a prospectus or an offerer’s statement. Securities Commission spokesperson Roger Marwick was quoted in the Timaru Herald as saying that the commission had received a number of complaints regarding investment schemes established by Cant, who was now banned from acting as an employee or agent of an investment adviser or broker in any way that would allow him to give investment advice or receive investment money or investment property from a member of the public. He was also not allowed to direct, promote, or manage any investment adviser or broker company for 5 years. The aim of the Financial Service Providers (Pre-Implementation Adjustments) Bill is to ensure that incidents like this are eradicated from our financial services sector.
Members have heard that the previous Labour Government passed the initial two bills in 2008, in the knowledge that further tidy-up legislation would be required, so that work could proceed on the implementation of the financial service advisers regime as quickly as possible. The Government was slow to introduce this bill, and we heard my colleague the Hon Lianne Dalziel refer to that earlier. Really, that has been our only criticism of this bill, as it prolonged uncertainty for the financial services sector. The bill as introduced did not address all the issues identified by the stakeholders, and, as a result, the Commerce Committee virtually had to rewrite it. An enormous amount of good, productive work has gone into that.
There is a fundamental difference between the groups of people who have lost money that they invested. There are savers and there are investors. Investors are those who have, or should have, knowledge of risk, and who seek advice from different sources and make decisions after weighing up the odds. What they did not assess as a risk was the negligent behaviour of people who had no knowledge except that the more they sold, the better-off they were, which was conflicted in the extreme. Savers, however, are the ones who put their hard-earned dollars into the hands of the people whom this bill is hoping to regulate, to get the rotten eggs out of the sector. With their savings went their dreams of a retirement with dignity, a retirement spent enjoying the fruits of their labour, only to see that reality cruelly taken away. Savers do not necessarily price-risk as investors do. They pay others to assess the risk and expect competence, diligence, and honesty. As members have heard this morning, we expect that from an accountant, a lawyer—
Hon Clayton Cosgrove—mostly we expect it from those people—and a doctor and a dentist. Why should we not expect it from a financial adviser? It is not too much to expect, and hopefully this bill will go some way to addressing that situation.
Investors understand that risk equals return, whereas savers—the mums and dads, many of whom lost all their money in the financial sector—were not pricing risk. They were putting their money away for their retirement, their children’s education, or their grandchildren’s education. This travesty has resulted in the increase in ill health and decrease in well-being of a huge cohort of New Zealanders. Labour did something about the problem. We passed the Financial Advisers Act and the Financial Service Providers (Registration and Dispute Resolution) Act. This bill makes adjustments that are machinery in nature, and there are an awful lot of them, but that does not make it any less important in protecting the most vulnerable in our society, so it is an extremely important bill.
The bill is important for other reasons, as well. One of the problems in this country is the do-it-yourself mentality to investment and savings. Many people think they know best about how to make an optimal return on their savings, without seeking advice from those who are expected to know the markets and the different investment options. It is a double bind in many ways, because I guess if we just did it ourselves then we would be taking the risk ourselves. But if we ask for financial advice from somebody whom we think is reputable and then do not get it, it is no wonder there is no confidence in the financial sector. Of course, it is not that all financial advisers have acted in an unscrupulous manner, and not all of those who were operating in an unscrupulous manner were operating out of the back of a tin shed. There were many financial advisers in glass towers whose advice was as devious and self-serving as the advice of financial advisers operating anywhere else.
This bill, I hope, will be another step in the process of rebuilding the confidence of ordinary New Zealanders in the investment advice sector, because it is what is needed. It is absolutely necessary, because it starts to rebuild the confidence of ordinary Kiwis in the financial advisory market. They need to know that when they take their hard-earned money to a financial adviser, they will get independent, competent advice from a person who will walk them through all the risks and benefits in a transparent and meaningful way. Once again, I thank the Commerce Committee members and all of the officials for the hard work they have done on this bill.
JONATHAN YOUNG (National—New Plymouth) Link to this
I am very pleased to be able to stand and support the Financial Service Providers (Pre-Implementation Adjustments) Bill. I congratulate the Minister of Commerce on the hard work that he and his office have put in, and as well I acknowledge the tremendous work that the Commerce Committee has put in. The bill is very complex, and the Commerce Committee does handle a lot of complexity. I think back to the Patents Bill and all of the discussions that we went through—and are still going through—regarding that bill. It is important that we collaborate and work together to find solutions that will work, particularly in this case for the investment sector of our society.
Professor David Mayes, the new chair of finance at the Auckland University business school, has said that New Zealanders are average when it comes to financial literacy. We know that we are above average in many, many areas, but this is one particular area in which, it has been noted, we are lacking. But he went on to say this problem is not unique to this country. A lot of finance company collapses occurred before the effects of the global financial crisis were felt here in New Zealand, which puts us ahead of the curve on this one. We discovered that people need to have financial literacy, and that education in our society in particular has come up as an obvious area where improvement is needed, after the series of finance company collapses, which has seen, as the previous speaker said, 200,000 people lose money. I heard one report that said that $6 billion of those people’s savings have been lost. The tragedy is that many of the people who lost their funds are in their retirement, so they do not have the opportunity to recover. They have no opportunity to go out and work, and to find other alternatives or options to raise an income for their retirement.
This bill seeks to amend the Financial Advisers Act 2008 and the Financial Service Providers (Registration and Dispute Resolution) Act 2008. The intent is to ensure that these Acts provide for the responsible regulation of the financial services sector, and bring robust consumer protection in order to restore confidence and trust in the financial services sector. Many of the people who lost their savings in investments did not appreciate the risks that they were taking, and would have benefited from receiving knowledgable, robust, and independent financial advice. Throughout the process of preparing this legislation we continually were aware that there are different types of investors, but I will speak on that point later.
This legislation has been well looked forward to. I think it will bring robustness to the industry and to the sector. It will be good for investors and savers, and it will also be very good for the industry. It will bring confidence gradually back—it may not rush in—to this area. That will, in turn, release capital for businesses, including small to medium sized enterprises, and bring opportunities for businesses in this country to get ahead. Thank you.