The FSC said accessibility and affordability of advice are critical to facilitating the financial wellbeing of Australians.
“One of the objectives of the FOFA reforms was to make advice more accessible and affordable to consumers, in addition to improving the trust and confidence in financial services,” the statement said.
“The question is whether FOFA has been effective in achieving this.”
In the statement, the FSC reaffirmed its support for the recommendations laid out in the Financial System Inquiry (FSI).
“The FSI demonstrated that Australia’s world-leading financial system is stable, secure and innovative,” said FSC chief executive Sally Loane.
“The FSI ‘health check’ found there was room for improvement especially in respect of competition, stronger enforcement of the law and better governance.”
The FSC also supports a model framework for adviser standards, which includes a new standalone independent standards body, higher entrance requirements for financial advisers, and ongoing education for financial advisers, the statement said.
Other policy goals for advice laid out in the statement included aligning remuneration with consumer interests in life insurance advice and enhancing consumer understanding through shorter and more effective statements of advice.
“One of the objectives of the FOFA reforms was to make advice more accessible and affordable to consumers, in addition to improving the trust and confidence in financial services,” the statement said.
Yet the FSC are desperately pushing the LIF which will make access to Life Insurance advice much higher for consumers, will decrease Independent adviser numbers and only increase profits for banks and insurers. Incredible hypocrisy by the FSC.
It appears that the FSC are now the almighty, over-arching authority on everything financial. Have the FSC morphed into the regulator and legislator without any of us realising?
It is simply ludicrous that the FSC, which in the end is only an industry association representing it’s own membership is held up as a guiding light and authority.
The FSC Board Charter, Feb, 2012 states in it’s introduction,….”The FSC, as an INDUSTRY association for the managed investment, superannuation and life industries has as it’s PRIME ROLE the advancement of the efficiency and integrity of the financial system and the PROMOTION through government and regulatory channels and public communications THE INTERESTS OF IT”S MEMBERS “.
As a member funded organisation, the FSC’s primary responsibility is to the benefit and interest of it’s members.
It would therefore make entire sense that any legislative change that would disadvantage their members businesses would be opposed and any proposed legislation that would benefit their members businesses, such as the Life Insurance Framework, would be strongly supported and encouraged.
The FSC has cleverly defined itself as appearing an authority without bias or conflict of interest. When your membership and the fees paid by your member’s is the funding model for your existence, you are indebted to primarily promoting and supporting their interests, even though the sell and the spiel, may well be appear to be that concerning a populous topic or issue. When many of your members are listed, public companies and their primary responsibility is to their own shareholders, one can only assume that best interests of the general consumer is not a primary responsibility or concern.
This is no different to a union where the members pay a fee for strength in numbers and representation that will push their agenda in the best interests of it’s membership.
@ Graham – Agreed.
Don’t get me wrong, assess FOFA on improving consumer outcomes from a quality of advice perspective and I’m sure it’s done fine banning commission etc..
However, surely nobody actually thought it would ever reduce the cost of advice or make it more accessible. Anyone who thought that certainly should be advising on these things in the first place.
Well it certainly hasn’t (along with Trowbridge / Lif) made it more affordable. As for accessible, I suspect access is highly dependent upon cost . One does wonder where these Pie In the Sky ideas come from.
Increased cost of compliance, downward pressure on remuneration and the result will be obvious. I can say categorically that the cost of advice has already risen for many clients and I suspect it will get worse. But then what would I know?