The JAWG — made up of 13 key associations including the FPA, AFA, FSC, SIAA, TAA and CA ANZ — has penned an open letter to Stephen Jones regarding the Quality of Advice Review (QAR) and the government’s impending response.
In the letter, JAWG said it wants to “collaborate with the government on implementing much-needed change” to ensure “many millions more Australians can access advice for decades to come”.
“We note your strong support for the Quality of Advice Review process under Michelle Levy since its inception. We are grateful for your acknowledgement that financial advice is out of reach for most Australians, in part because of poor regulatory settings,” the group said.
It stressed that the government’s response to the QAR “should be driven by the needs of everyday Australian consumers”.
“The number of Australians who now receive financial advice has fallen by around half. At the same time, the number of advisers has dropped to around 15,800 from over 26,500 in 2019. The average cost of financial advice has increased steadily to over $5,000.
“Urgent action is needed, the government has a rare opportunity to deliver affordable and accessible advice to consumers as an outcome of its response to the Quality of Advice Review,” the group said.
It noted that some “stakeholders continue to argue for the status quo without offering real solutions for the many Australians who retire each year without financial advice”.
As such, JAWG said that any response to the QAR must increase access to quality financial advice while maintaining appropriate consumer protections that are proven to work in the interests of consumers.
To the JAWG, this means the government’s package will only succeed if it:
1. Ensures consumers can get scaled advice that is the advice they want, how they want it, and when they want it, including via digital means.
2. Supports a professional financial advice sector by increasing the number of financial advisers and financial advice providers, while maintaining a level playing field.
3. Removes regulatory and disclosure requirements not benefiting consumers.
4. Reduces the time and cost to prepare quality financial advice.
5. Establishes a regulatory approach that facilitates the provision of financial advice without uncertainty or shifting goalposts.
“We believe that many of the final recommendations of the Quality of Advice Review are aimed at achieving these objectives. But Australian consumers will be left behind without the adoption of a holistic package of reforms. The reforms must extend beyond easy wins such as streamlining fee disclosure requirements and iron-out obligations like the design and distribution obligations,” JAWG said.
“The government should commit to implementation time frames that would see consultation with industry on a holistic package of reforms that are introduced into the Parliament this year,” it continued.
“We look forward to the release of the final report. Following its release, we would welcome the opportunity to meet to discuss how the government can improve the financial wellbeing of all Australians by ensuring they have access to quality financial advice.”
Is JAWG also based in Amity Island and led by Chief Brody?
many financial advisers are not equipped to deal with property issues and have no understanding – as apart from some accountants knowing about negative gearing – it is very woefull, as many australians own rental properties
bollocks – what evidence do you have for that – property is a really simple leverage play – no we don’t speculate, and no we don’t spruik. but to suggest we don’t do or understand property is borderline stupid. For many it forms the mainstay of a family’s wealth generation.
‘Many’ .. yeah going to want to see a source on that one.
The degree to which the rules are relaxed will depend entirely on what the industry super funds and the unions allow.
They don’t need public servants to dictate the changes, what they need to do is actually LISTEN to the advisers who are already on the front line providing the advice. Here’s what they can start with: 1- Remove the 12 FASEA rules and scale it back to “Appropriate Advice” 2- Remove the annual opt-ins 3- Remove FDS 4- Simplify the content and disclosure in SoA’s – and by that I mean no more than 10 pages! That would be a good starting point!
The 12 FASEA Rules are in fact standards based on values. Obviously a bridge too far in the road to professionalism?
The only way to release the regulatory chock-hold on financial advice is for the operators to demonstrate professionalism. FASEA didn’t give “rules”, it gave a pathway out of the nanny state.
i agree.
Highly agree with points 2, 3 & 4. Why do we have to repeat our fees so often? And if the client agrees to them up-front (detail in the SOA and original Service Agreement) they always have the option of canceling them when they wish to, instead of chasing them up year in year out.
There’s no election coming up, so I doubt we’ll hear anything back from Mr Jones apart from his standard “sounds good…we’ll look into it” line
we shall have to see if he decides not to act but election year or not has literally nothing to do with that decision – we really dont count for that many votes LOL
and counting for less votes as each day goes past.