Financial Services Minister Stephen Jones attended a series of open industry events hosted by JAWG in Brisbane on 11 July, Townsville on 12 July, and Cairns on 13 July, where he answered advisers’ questions.
According to Sarah Abood, chief executive of the Financial Advice Association Australia (FAAA), advisers were keen to understand how quickly the Stream 1 measures included in the government’s response to the recommendations of the Quality of Advice Review (QAR) could take effect.
“This first package of reforms is critical in helping advisers deliver more great advice for Australian consumers. The government and Treasury are moving swiftly to implement these measures, and the minister clearly stated his goal for draft legislation to be available this calendar year,” Ms Abood said.
“Of the Stream 1 measures, most questions were asked about the statement of advice proposals, and in particular, how the industry could gain sufficient confidence in delivering more fit-for-purpose advice records for consumers.
“The minister also said he wants to ensure that the legislation is not too prescriptive. He and his team are very aware of the need to involve all stakeholders early, including licensees and the regulator, in designing a solution that will achieve the goals.”
Ms Abood said there were also a lot of questions about the Stream 2 reforms – which the government dubbed the “expanding access to retirement income advice” stream in its QAR response – particularly around how the government envisages superannuation funds will deliver a potentially broader advice offering to members via non-relevant providers.
“The minister said that he sees transition to retirement advice as an area of high unmet need and a priority to solve,” Ms Abood said.
“He has heard loud and clear some of the concerns and need for safeguards around the complexity of this advice, the qualifications of those delivering it, and the impacts of collective charging.
“He has said he is open to views on these matters, and they will be front and centre in the next stage of consultation on this stream of reforms.”
Unsurprisingly, many advisers also raised the significant increase to the ASIC levy, which has caused a lot of concern among the profession since it was announced.
“It just doesn’t make sense to see the per-adviser ASIC levy almost tripling, at a time when the number of advisers has almost halved, and we are trying to reduce the cost of advice for consumers,” Ms Abood said.
“This issue was proactively raised by attendees at every event, and the minister has now heard the concerns very clearly, directly from those most affected. We continue to engage intensively on this matter, as we believe that even under the current Industry Funding Model (which we know has flaws), there could be ASIC costs that have been incorrectly attributed to our sector.”
The minister also responded to questions covering education and the need to rebuild adviser numbers.
“Members spoke to their own different pathways into the profession and the need for support for different types and stages of new entrant. The government will commence another piece of work soon which will address these matters in more detail,” Ms Abood said.
She added there was also discussion around providing better access for advisers through the Australian Taxation Office (ATO) portal and via Centrelink to enable them to serve clients more efficiently.
“Of course, facilitating this access would also reduce costs for government,” Ms Abood said.
“Minister Jones has carriage of the Consumer Data Right and is known as the ‘digital minister’ for having moved to paperless in his own office. So he definitely has a strong understanding of the need in this area, and the potential benefits in efficiency and lower costs that could be achieved.
“We have also separately spoken about the potential for efficiencies in areas such as Anti-Money Laundering and Counter-Terrorism Finance Act (AML/CTF) reporting obligations, in moving to digital identity verification.
“We are hearing strong support for digital solutions from the government, and we will shortly be asking members for help in building the case to go to the next stage on these priority areas.”
I’m now on the fence for the first time in my career as to whether I will stay or go. If they can bring in the shorter advice document quickly that will probably sway me. Currently I pay an external paraplanner and most often this delays me being able to provide advice quickly as they are never quick and then there’s the cost. If I could create the document and have it ready to present in 24 to 48 hrs that would change my business dramatically. Currently I require 2/3 of my revenue to come from new business to survive as my book is in growth stage. We all know how hard it is to do new business. I have no shortage of new clients but the process is time consuming and often difficult with licencee reviewing every SoA/RoA and I feel I can’t increase my fees any higher. With the amount of effort I put in I’m sure I could do better elsewhere but my heart is with planning!!
pretty ridiculous your licencee has to supervise every SOA/ROA. Are you on Probation?…It won’t be a SoA it will be a Statement of Evidence..and it will still be pages and pages. The Corporations Law may be amended but the other 11 pieces of regulatory oversight ain’t changing. Further, Governments particular Labor Governments don’t like making things easy, the more people working for the Government keeping an eye on you the better for them.
You’d do better anywhere else. Brokers and accountants don’t need our fasea level education experience business risk and costs. Not to mention witch-hunting media regulator and government. For far less work and arguably similar or higher dollar risks to the consumer. It’s a global joke
Arent members of JAWG the same people who let this whole mess get out of hand in the first place. Look at the FAAA for example, they “worked with” government on LIF and look where that got us.
JAWG does not represent me !
apparently they do…at least according to the FAAA
JAWG dropping!