Late last year, the ALRC tabled an interim report in Parliament detailing the complexity of Commonwealth legislation regulating corporations and financial services with an aim of promoting meaningful compliance with the substance and intent of the law.
“The ALRC’s task is not simply to ‘tidy up’ the legislative framework in service of theoretical objectives. At the core of this Inquiry is the importance of ensuring the law is fit for purpose,” ALRC president, the Honourable Justice SC Derrington said at the time.
“The law must facilitate industry, recognising the dynamic nature of the financial services sector and its significant contribution to the Australian economy. At the same time consumers need to be able to understand and navigate the law to protect their legal entitlements.”
Now, industry stakeholders are being called on to provide feedback about the report to the ALRC.
“The ALRC’s focus is on how the current law can be simplified and made easier to navigate,” a statement given exclusively to ifa read.
“Input from those ‘at the coalface’ – such as financial service providers, financial advice businesses, financial advisers, and clients – is critical to understanding why the current law is so complex and how it could be improved.”
Submissions about the proposals and questions raised in the report can be put forward to the ALRC before 25 February however the independent agency said it will hold webinars, consultations and events this year to continue the consultation process.
Another call for submissions will be made following the release of a new report in late 2022.
“The ALRC is also particularly conscious of Treasury’s Quality of Advice review to be conducted in 2022,” the statement continued.
“That review presents another opportunity for the financial advice sector to engage with the law reform process, and the ALRC will follow it closely.”
This highlights the problem. One arm of Government doing a review while a separate review is being done on similar things by another arm of Government.
While ASIC have KPI’s to justify its existence nothing will change – Headlines like
“an order was made against Michael Christodoulou King following a presentation by ASIC of a creditor’s petition regarding his failure to pay a pecuniary penalty order of $300,000.Justice Kylie Downes made the decision on the basis that Mr King owes provable debts of over $177 million with no evidence to suggest he can pay them…. ” Where was ASIC , where was its intelligence Unit etc etc when read the PDS and blind freddy would ask questions!!!
This is a joke, right?
Ask the industry for input!!….you cannot be serious!
How much more input can there possibly be over the last decade advising the regulators and govt about how NOT to go about things and the consequences that WILL occur if they do.
It has all come true, every last sad bit if it…but legislators, regulators and academics know best and didn’t want to listen to reason and logic because they hold an ideological opposition to the advice profession.
It is and has been a recipe for negligence of the highest order.
The answer is straightforward. Undo all legislative change since about 2010. All of it has added cost and complexity.
From ASIC in 2021 :
“Based on those roundtable discussions, ASIC said on Friday it has “identified a number of initiatives that may assist industry participants in providing good-quality, affordable personal advice to consumers” and intends to move forward with those initiatives.”
So their only “initiative” since was more compliance work (and costs) with a need for advisers to show SoA’s to super trustees to justify advice fees for clients! I think ASIC have become the kings of selling red tape far better than Bunnings…
AML/CTF. ROA, FSG, PDS, SOA. TMD. Optin in, LOE, TOE, ASIC, FPA, TPB, FDS, AFCA……can’t really think of anything myself.
Your forgot SDB. Which according to lying Jane Hume is the “Single Disciplinary Body”, but is so obviously not.
And we won’t even mention FASEA…
FDS, FSCG, AAA
And who is “the Industry”? Most likely the same mob of rent seeking “middlemen/woman” who are not client facing Advisers and who want to make a quid out of the business before moving on to the next business venture.
Groundhog Day! Another government entity asking for feedback…The time for talking is over how about taking actions based on all the previous feedback given?
Step one – remove the requirement to be under an AFSL for financial advisers.
This is like Groundhog Day! Another group wanting feedback? Everything that needs to be fixed has already been said infinitum but still no meaningful actions. Maybe the ALRC can surprise us?
simple starting point, start with the duplication of our obligations. why so many now that we have stepped up? the AFSLs and prof groups like FPA/AFA need to act align also. there are several pieces of disclosure that can be consolidated into the legislation and amended. I suggest a letter of engagement as appropriate, simple form SoA/RoA for advice and an industry accepted simple review document/signature page for continues service. put that in the bloody big book!
A bit difficult to send a submission when advisers themselves can’t get through the legal jargon. FASEA, bless their poor souls could NOT come up with a clear code for advisers and threw in the towel because they could not come up with a clear answer, ASIC still unclear in a lot of areas. Smarter people than me can have a go but the time will be wasted and to no avail. Plain English and common sense severely lacking.
So Frydenberg, Treasury, ASIC & so called Consumer Interest groups totally stuff Advice regulation and refuse to listen to Real Advisers.
At least ALRC say they want to listen to Real Advisers but once the like of Frydenberg,
Treasury, ASIC & so called Consumer Interest groups get involved, yet again Real Advisers won’t be listened too.
Out with Frydenberg
Out with Ms Press
Clean out Treasury & ASIC and start again.
If the ALRC is genuine in their desire to get input from the coalface that would be most welcome, and a complete departure from previous methods of regulatory review.
However experience has shown that “stakeholder consultation” is really just a sham exercise to siphon more taxpayer money off to academics and fake “consumer groups”, to help them prepare submissions which align with the pre ordained outcomes. Real stakeholder input is neither wanted nor considered.
Complex and ridiculous
It is clear that consumers are the big losers from overly complex regulation. But who are the big winners? Lawyers and regulators.
We have seen a recent example of lawyer Hayne and his henchpersons imposing even more complexity on financial advice that will benefit his lawyerly brethren, but make things even worse for consumers. How can lawyers and regulators be trusted to reform a system that currently benefits them at the expense of society?
Very true. We are ruled by the fear of litigation etc. This is a real elephant in the room right now and not just in financial services.