Delegates at the AIOFP conference last week quizzed Turnbull government MP Stuart Robert on several issues affecting the financial advice industry, arguing that the government has only listened to the big end of town.
On Friday, Mr Robert delivered an update on some of the key legislation that is going to impact financial advisers, including the Life Insurance Framework (LIF) and professional standards reforms – the latter of which will be introduced into Parliament on Wednesday.
Following his address, one delegate commented that the changes will soon put advisers under significant financial pressure, with other reforms proposing that advisers pay for ASIC as part of a user-pays funding model; pay for a new dispute resolution tribunal; and, ultimately, pay to fund an education standards-setting body on an ongoing basis.
This is all in addition to rising professional indemnity (PI) insurance costs and falling revenue, the delegate said. He asked the MP when the government planned to start listening to the "real people", and not the big institutions.
Mr Robert, however, responded by saying all legislation is a compromise.
“Is it a compromise? Yes. Is it perfect for all parties? No; a compromise never is. Are there costs and change involved? Yes. But that is why the timeline is there: to allow organisations in the industry to adjust,” he said.
“There is no perfect response. There are always going to be people who aren’t happy.”
Another delegate asked Mr Robert why the government has not gone after superannuation funds and the potentially conflicted "bonuses" they receive from group insurance.
Mr Robert agreed that this may be a conflict, and said he will “have a look at it”.
Finally, Mr Robert was asked why the government has not taken any sort of initiative on the issue of vertical integration.
“It wasn’t in financial services reviews or from ASIC as a major source of contention. If it’s not raised, it generally will not be looked at,” Mr Roberts responded.
“Vertical integration in any market is fine as long as there is widespread competition. The question should have been is there enough competition, and I am not too sure.”
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