Speaking on the latest episode of the ifa Show, Mr Jones said “stability and certainty is key” for the industry given the “unprecedented” regulatory change in recent years.
“We’ve had a tsunami of change. What the industry needs now is stability and certainty,” he said.
“So, whether it’s in superannuation, we want to ensure that 12 per cent [superannuation guarantee levy] SGL is guaranteed and that funds are well run, well-managed, delivering great outcomes to members.
“As I’ve said, time and again, I think the thing that we need to get right is the advice stuff because it’s broken and consumers are suffering.”
It comes after experienced financial adviser Helen Baker argued late last year that the “over-regulation” of the advice sector is impacting financial planners’ mental health and driving them out of the industry.
The number of advisers in Australia shrank below 19,000 late last year and is predicted to reach 13,000 by the end of 2023.
Mr Jones added that the current regulation is not “fit for service” and that consumers are also suffering because of the reforms.
“We need you guys focusing on the needs of consumers, not looking over your shoulder for the next wave of regulatory change that’s going to be coming to from whoever’s in government,” he said.
Listen to the full podcast with Mr Jones here.
32 years in this industry and the last 5 years have left me mentally broken and shattered, burnt out and suffering from major depression & anxiety.
This incredible benefits quality financial advice and strategy can deliver to the Australian people is invaluable, however the highly discriminatory way in which this current govt has unfairly targeted advisers is simply appalling.
I have been now forced to leave to concentrate on my own health because if I did not, I would most likely have been yet one more statistic of the vicious and vitriolic treatment of so many good, caring and ethical advisers have endured.
Article states: “The number of advisers in Australia shrank below 19,000 late last year and is predicted to reach 13,000 by the end of 2023”. Well, after 36 years in this industry I can tell you it will not only continue to get worse but worse than most expect. Prepare to see adviser numbers decrease to well under 10,000 by 2025 as the full idiocy of the regulations come to bear upon those who remain.
[i]I reject outright any assertion that common sense will prevail.[/i] How can it? It has had SO many chances over the decades and failed. Why would it now, in this newly ‘woke’ world? With self-absorbed politicians, special interest groups, banking elites, insurance company execs all wanting what they think they can have from a smaller pie, well, what my hardened experience and considered opinion watching this game over nearly 4 decades says to me is that these are the end-times of what our once-great industry was and ‘could’ have been. Post-2026 there will be no risk advisers [i](stand-alone risk advice is simply non-tenable currently and will be a fully losing proposition by then)[/i] and probably 5,000 – 8,000 investment advisers/full service financial planners. It won’t stop there, the decreasing adviser numbers, as the attrition rate of the uni-grads increases and the hold-out older advisers continue to leave. Way less than 5,000 ‘advisers’ (by name only) will remain by 2030. AI will be the default, accepted way to get your financial advice through roboadvice moving into the 2030s. There will be exceptions for HNW clients but that’s all. How do I know this will be the future? Because I know the players and those who control the players and this is what they have always wanted. This is what they [b]will [/b]get – things are in place to enable the final parts. Any ‘adviser friendly’ changes will be temporary window dressing, you can bank on that – they are.
The adviser landscape will be populated by the new breed of uni-graduate planners coming through, graduates who pin their future prospects on their academic prowess and little more. With minimal people skills, generally, and an academic focus they will alienate retirees and regular investors who will see better value for money in roboadvice. [i]Clients won’t feel like someone has their back.[/i] Frankly, the young graduates will only be parroting the same information that is programmed into the cybernetics of roboadvice – all tick-the-box analysis.
I don’t blame the new graduates or harbour any ill-will towards them at all as they are simply an outworking of our times and system. We all know who is to blame for our industry’s destruction – those that stood by while the adviser-killing regulations were formulated and did nothing to stop it. [b]The politicians, bureaucrats, banking elite, corrupt industry super funds, life company execs[i](i.e. 2-yr clawbacks)[/i] and special interest groups – this is the focused army that has destroyed our industry.[/b] The fortunate clients are the ones who maintain contact with their old advisers after the adviser’s retirement – as a sounding board. At least they can get some ‘direction’ [i](I dare not call it advice!!)[/i]. Advisers who looked after loyal clients for decades won’t simply abandon them to the uni grads, they will stay in the picture and ‘help’ whenever they can – not for money but for duty/friendship/being true to themselves. At least that’s the situation with a dozen or so adviser colleagues that retired around the same time as I did. Good luck to the advisers who are still in the quagmire, you’ll need it, especially the riskies.
There is also a glass half full view.
Once the product providers get into robo advice, the politicians will finally pull the trigger and separate advice from products. This will result in advisers finally being able to act in their clients best interest without having to sell our masters underperforming investment products.
The 5,000 advisers that remain will be able to earn a great living off helping their clients.
Let’s hope it pans out that way. I agree, yours is the glass-half-full version of my comment above. I’ll put money on my view being the one that plays out however I appreciate the thoughtfulness of your view. I hope I’m wrong and you are right . . .
Instead of playing the whiny small target, why doesn’t Jones actually provide some ‘stability and certainty’ by announcing his plans for the industry? The election is just over 2 months away and we still have no idea what ‘reforms’ he would put through if his side wins government. Until then, he can only expect to continue being treated with suspicion by the industry generally.
I agree that Labor in general has been trying very hard to avoid specific policies. But in fairness to Jones, he did announce significant reforms to FASEA rules before Hume did. He also announced the binning of Hayne’s recommendation about mortgage broking commissions, which was a pretty big about face for Labor. While we may not agree with everything he says, Jones does seem to be one of the few ALP politicians who is willing to speak frankly and take a position on things.
So there should be no changes… here are some changes.
No thanks, Jones.
Why were they opposed to making adjustments to FASEA two-three years ago..why now? why did they say they would implement 100% of the Royal Commission recommendations and now it’s different..why now? ….what’s changed? ..an election.
Jones is still for abolishing commissions for insurance products while keeping them for home loans….makes no sense.
Jones is also talking about watering down educational standards for existing advisers despite the fact that existing advisers have had up to 75% of the units required for a Bachelors Degree waived under the pathway put in place by FASEA. Anyone who doesnt think that isnt a concession to and acknowledgement of experience and training has rocks in their head or is just too lazy to do the little amount of effort required.
You think advisers with existing degrees (and hundreds of CPD hours) should be grateful about only having to do 25% of another “degree” at a glorified TAFE associated with a corrupt FASEA Board member?
Words, just words. The libs have made this mess, but guaranteed the outcome would have been the same or worse under the ALP. Just like a politician, Mr Jones says it needs to fixed, but does not outline one thing the ALP would do to fix the mess.
Its so SIMPLE – remove all commission based payments. If Financial advice is to be a true profession then charge a fee for your service like all other professions do. Its 2022 and time to move on !
Easier said than done… most clients baulk at paying fees. they would would for medical advise too except that the government or insurance pays the bills , so no one cares.
Perhaps it is time for an enteprising insurer to start and insurance product for advice fees …?
Lawyers still get paid Commissions…..
Lawyers are untouchable, because so many politicians come from that so-called profession. No royal commission with regards to the value for money provided by QCs on $15k+ per day.