AIOFP announces 2 new initiatives

Association of Independently Owned Financial Professionals (AIOFP) executive director Peter Johnston said the first initiative revolves around continued communication with Treasury and Financial Services Minister Stephen Jones.

“Unlike the previous government, Minister Jones has taken a more pragmatic approach to our industry by consulting with Treasury on their views to the various aspects of our industry,” Mr Johnston said.

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“Our political strategy team has met with Treasury over the past six months. We are very impressed with their understanding of how our industry operates and their open-minded approach to resolving issues. We will continue to liaise with them on an ongoing basis.”

The second initiative will take the form of a Life Insurance Framework (LIF) market impact paper, which the AIOFP has commissioned financial adviser and academic Lionel Rodrigues to complete.

“The LIF Legislation has been an absolute disaster for all stakeholders, this is widely recognised by all associated with the financial services industry and consumers whose premiums have doubled over the past five years,” Mr Johnston said.

“We need, however, to get these facts understood by those who still hold the view that ‘commissions should be banned in the risk insurance industry’.”

He added that the paper could assist the government and consumer bodies to understand the issues caused by LIF through “empirical data and facts”.

“Lionel Rodrigues has unique qualities of practical experience and academic achievement to deliver such a paper. Lionel has been an adviser for over 30 years and holds a master’s in financial advice/law and an accounting degree,” Mr Johnston said.

“This paper will be distributed across the political spectrum, Treasury, and all consumer groups.”

Mr Johnston also reiterated his praise of the Labor government’s handling of the Quality of Advice Review (QAR) and how it has positioned the industry.

“The AIOFP is delighted with the current positioning of the advice community in both political and structural terms. Minister Jones and the ALP National Executive are honouring their pre-election pledges and the three-stage implementation process announced recently is a very solid step in the right direction,” he said.

“The perfect market structure of all manufacturers in one corner with no advice capability only managing product and all independent advisers in the other corner working on a fee-for-service basis with consumers delivering advice will probably never happen.

“We must, however, now not dwell on the past darker times, but we must learn from them to position our political strategy going forward.”

Mr Johnston previously called the release of the government’s QAR response a “euphoric day” for advisers and a “huge step in the right direction”.

Prior to Mr Jones releasing the government’s response, Mr Johnston was highly critical of the QAR, particularly the proposal to allow non-relevant providers to provide financial advice.

“It was initially suspected that Michelle Levy was an appointment by the Liberal Party to allow the institutions back into the advice industry with digital advice by lowering the standards for consumer protection, this now emphatically confirms it,” Mr Johnston said.

“Thankfully, Minister Jones will ‘cherry pick’ some of her ideas and bin the rest. What a waste of taxpayers’ money and worse, seven months of wasted industry development time waiting for this confused conflicted diatribe.”