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Dealer group director says ‘no incentive’ to join advice industry

The director of an Australian dealer group is not surprised at the amount of financial planners who have left the advice sector in recent years.

In an opening address during a House of Representatives standing committee last week, Synchron director Don Trapnell noted that 6,500 advisers have left the sector in the last two years, while only 163 have joined in that period.

“Quite frankly, I’m not surprised," Mr Trapnell told the committee.

“In fact I’m surprised that many actually joined. There’s no longer much incentive to come [be a] part of our industry.

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Mr Trapnell largely discussed the “over-regulation and over-taxation” in the sector during his address and called for urgent intervention, saying that it is at a “crossroads”.

He noted the recent ASIC levy – which saw costs to the advice sector increase by more than $16 million – and the government’s proposed compensation scheme of last resort (CSLR) – which would force the sector to pay over three-quarters of costs within the first year of the scheme – as examples as to why he believes the industry is under attack.

“Of the 70,500 AFCA complaints, 997, or 1.4 per cent involved advisers. Of the 997 complaints involving advisers 974 were settled, thus leaving only 23 unsettled complaints involving advisers. Unsettled complaints from the advice sector therefore represent 0.03 per cent of all AFCA complaints, yet this sector is to fund 75 per cent of the scheme,” Mr Trapnell said.

“There’s only one word for that, that’s disgraceful.

“In what other universe is this kind of penalty passed onto small business with so little justification?”

Dealer group director says ‘no incentive’ to join advice industry
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