Giving advisers access to ATO portal should be a ‘no-brainer’: FAAA

With the government apparently setting its sights on reducing the cost of advice, Financial Advice Association Australia (FAAA) chief executive Sarah Abood has argued that allowing access to the portal would make information gathering considerably easier while removing the need for creative workarounds by advisers, which would lead to a positive flow-on effect to client costs.

“When you look at where the cost of providing advice [is], this is one of those places, because information gathering, in order to give great advice to a consumer, is costly and time-consuming and manual right now,” Abood said on The ifa Show.

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“I’ve heard from members who are getting their clients to come into their office and log in so that the adviser can see the information because it’s not always easy to parse what you see on that screen when you log in as, you know, just a normal person.

“I’ve seen advisers or heard from advisers who are trying to go through the client’s accountant. That can take some time. It’s just unnecessarily time-consuming and expensive and crazy for consumers.”

While Abood said “it does seem like a no-brainer”, the Tax Secrecy consultation covering, among other things, advisers accessing the tax portal suggested that Treasury still doesn’t think the benefits outweigh the risks.

One of the key arguments raised against providing advisers access was the potential cyber security risks; however, Abood pointed out that recent events show how large institutions are not immune to attacks but are still allowed this privilege.

“We would absolutely say cyber security is incredibly important. However, I don’t think introducing financial advice firms is going to change the cyber security risk profile of that portal,” she said.

Abood argued that, unlike accountants, advisers operate under an Australian Financial Services Licence, which places additional levels of accountability and scrutiny on practices’ cyber security for even the smallest of businesses.

“Financial advisers, I think there’s a good argument that, on average, their cyber security is probably better than the average small accounting firm,” she said.

“I’m not going to say it’s perfect. I don’t think anyone can say it’s perfect … We’ve had large telecom providers, we’ve had super funds. It’s a rare type of business that can say they’ve never been attacked or they’re immune from attack.

“Our key point there is it doesn’t make it worse than the current situation if you provided access to advisers.”

The other point raised was the apparent cost of doing this, though Abood said the FAAA is “hopeful that the cost wouldn’t be as high as Treasury fears”.

“It’s one of those things where, yeah, there’s an investment. We don’t think it will be super big, but it will take down the ongoing red tape and manual processes for years to come and definitely worth doing for both accountants as well as advisers,” she said.

Because advisers will simply need read-only access to the portal and the framework for accountants is already there, Abood argued that extending this to advisers should be relatively simple and low cost.

“I think there’s a strong groundswell of support there making the point that the benefits of providing advisers access well and truly outweigh the costs and the risks,” she said.

“We’re certainly hopeful and yeah, it was great to hear the Coalition’s strong support for that and we’re hopeful that that’s one of the outcomes that advisers will get in the near future.”

Abood added: “Sometimes I wonder if being the government is a bit like organising a wedding, you know, how the flowers are always twice as expensive if it’s a wedding compared to a normal bunch.”

Moving forward, the FAAA CEO said there needs to be a really clear understanding of business requirements for that system change, ensuring they’re not “gilding the lily” while focusing on what is needed to provide the best outcome for customers.

Ahead of the impending election, shadow financial services minister Luke Howarth said that, if the Coalition is successful on 3 May, he will open up access to the ATO portal for advisers.

“It’s something that we’re committed to and we need to get the department moving quickly on that,” Haworth said at Momentum Media’s election event earlier this month.

To hear more from Sarah Abood , tune in here.