Speaking on the ifa podcast, Peter Johnston, executive director of the Association of Independently Owned Financial Professionals (AIOFP), said that when advisers unite behind a shared objective, they are a “force to be reckoned with”.
“I was an adviser for 20 years, and I know exactly how much power we have with our clients on political and commercial matters,” Mr Jonston told ifa.
“We think the politicians are just working out that advisers have a very strong relationship with their clients.”
Mr Johnston noted that this was partially demonstrated during the 2022 federal election, where Treasurer Josh Frydenberg lost his seat, deeming it in part due to the AIOFP’s “Kooyong marginal seat strategy”.
“We had 280 advisers within the seat and they all had 200 clients each … who they can have direct influence on by telling them that the cost of advice has doubled because of Josh Frydenberg’s actions, and we need to send him a message,” he said.
“So this is throwing a bit of a terror through Canberra when suddenly, all these politicians are realising that advisers have a lot of power, because we have a strong relationship with our clients.”
Mr Johnston has regularly commented on the anticipated implementation of elements of the Quality of Advice Review (QAR), and among other things, has voiced that AIOFP is in line with Financial Services Minister Stephen Jones’ position that including superannuation funds in the advice process is preferable to allowing banks back into the fold.
Since then, Mr Johnston has confirmed that the AIOFP has engaged with Treasury on the QAR some five times over the last 12 months.
“We’ve met the key people in Treasury, and they are really smart, they really get our industry. They are there without any hidden agenda and to act in the best interest of the consumer,” he told ifa.
“The credit goes to Stephen Jones for that, and we’ve been at each of these meetings, and we’ve given our views, and you just get the feeling that these Treasury people are listening and learning, and we think they’ll come up with the right decision.”
And following last year’s federal election, Mr Johnston labelled Mr Jones “the most honest politician” in Canberra.
“I’ve been doing this for 30 years now, dealing with politics and whatever, and the bottom line is, he’s the most honest I’ve actually come across,” he said at the time.
Will advisers be consulted?
The industry now also hopes to have a seat at the table for the anticipated consultation on retirement products and their accessibility, which could reportedly implicate advisers.
Last week, ifa learnt that Treasury is expected to release a consultation paper in the coming weeks to strengthen the accessibility of retirement products.
Namely, while the intergenerational report revealed that total assets in the superannuation system are expected to continue to grow strongly over the next four decades, the government is expressing concerns over a noticeable reluctance among Australians to tap into their retirement savings.
According to the comments section on ifa, advisers are not pleased with the government’s latest announcement and many feel this new consultation paper is just another form of meddling into their affairs.
“More rubbish from Chalmers to sanction the total control and domination of advice by the industry fund sector,” said one reader.
If Mr Johnston is right, advisers can hope to have their voices heard when consultation on the matter opens.
[i]“We’ve met the key people in Treasury, and they are really smart, they really get our industry. They are there without any hidden agenda and to act in the best interest of the consumer,” he told ifa.[/i]
Let’s see how well this comment stands over the next 1 to 2 years hey Peter.
I think the teal independents were the main reason why Friedburger was cooked and lost his seat with the advisers and their clients having less of an impact…
Peter was so excited when the ALP came into power and really believed that Minister Jones was going to be the great hope for the side. Seems he’s realised that he has basically backed the same horse of a different colour. Jones, like this Government and the one before is ineffective and weak and we can expect no support from them.