In a communication sent to federal parliamentarians on Monday, AIOFP executive director Peter Johnston addressed the “constant criticism” that “our advice industry is divided and needs to be united to have any credibility in Canberra”.
“We agree with that general notion in the past but things have changed,” Mr Johnston said, saying the major institutions had adopted more influence in the biggest two adviser associations as institutionally aligned advisers grew to represent 80 per cent of the industry in the 1990s.
“The result? The advice industry has been ‘divided and ruled’ by the institutional lobby where the ‘independents’ were continually trying to differentiate themselves from the institutionally aligned adviser agenda,” Mr Johnston said.
“This political quandary was then capitalised upon by the institutional lobby in Canberra to favour their aligned associations’ agenda and pass the independent advisers off as ‘rabble’.”
Mr Johnston said politicians would be better off consulting groups such as the SMSF Association or Stockbrokers and Advisers Association as well as the AIOFP if they wanted “an adviser perspective” on regulatory change, while the ABA, FSC, FPA and AFA constituted “the institutional view”.
Mr Johnston made the remarks as part of a new awareness campaign to provide parliamentarians with regular information about issues in the advice industry, following a recent Zoom call with a number of prominent politicians to bring them up to speed with the industry response to recent regulatory change.
He said the association had been informed by one of the politicians it had consulted as part of this increased engagement that lobbying efforts conducted by other advice industry bodies over the past decade had been restricted to “a select few” MPs and senators.
But despite the AIOFP’s views on joining with the larger industry associations, Mr Johnston said in a separate communication to members that the industry body had welcomed FSU assistant secretary Nathan Rees’ moves to gain endorsement from all associations for a letter provided to both sides of Parliament advocating the swift passage of the FASEA extension bill.
Mr Johnston said other advice industry bodies such as the SMSFA and PIFA had also agreed to endorse the letter, which was “no longer needed” after the government agreed to extend a ban on LIC commissions last week, but that the AFA and FPA had not.
Johnson needs to get up to speed – most advisers are now non institutionally supported today. At a time when the AIOFP COULD be driving ahead, it’s looking behind.
When the FPA gets the intrafund “advice” racket stopped (or fixed), I might rejoin it. This is the major achilles heel for the FPA now. Until then, renewing your FPA membership is simply a wasted investment for true non-aligned advisers. Being paid ongoing salaries (& bonuses) while providing personal advice, without seeking informed consent from those members, nor the members being required to sign bi-ennial opt-in forms, is a insult to FOFA based advisers. Time for this outrageous racket to end. Alternatively, do away with opt-ins, if you want to retain intrafund. But you cannot have both.
Agree. The FSC is just a corrupt paid for lobby group by the instos for their profit and the FPA and AFA are so heavily reliant on sponsorship from the instos that they have just become order takers.
I didn’t think there were many institutionally aligned advisers left anymore?
Given the big migration in advisers away from institutions, and the move by many institutions to abandon financial advice altogether, it would surprise me if more than a third of the FPA or AFA membership were institutionally aligned.
It’s a shame the RC didn’t ban Vertical Integration, the biggest problem / conflict in the industry for the past 20 years.
However, the banks are existing pretty quickly, be it not from a ban but from such bad behaviour and maybe a tap on the shoulder to leave on their own accord or be pushed.
As the Institutions lose most of their advisers (or All) and the FPA & AFA lose their Institutionally biased political push with reduced membership.
We can only hope the Adviser Industry can recover independently from product ownership.
With the greatest respect to Mr Johnston, this sort of public brawling does nothing except help some of the more extreme agendas precisely because it allows those promoting them to divide and conquer.
To suggest that mainstream adviser views are better postulated by the SMSF Association or Stockbrokers Association is absurd – at best these represent only a slither of the advice profession, and, like AIOFP are representing a discrete segment primarily for the benefit of the segment.
I’d suggest also that AIOFP still don’t get what being a profession actually entails – hence why they keep pushing back against it.
With a lot of AIOFP being commission junkies starting to go cold turkey (or leave the sector) I’m not sure of the relevance of the AIOFP. If the AIOFP was to cease, Peter Johnston could spend more time looking for Jack Flader and the missing Trio/Astarra millions and pay it back to those super members who got slugged to pay for it.