Licensees to ‘battle’ with industry super for adviser talent

As major changes around superannuation tax heat up in Canberra, the government will soon turn its attention to an adjacent issue: affordable financial advice.
No announcements have yet been made on Michelle Levy’s recommendations, but the move to create a simpler system for superannuation funds to provide advice is expected to gain support.

Asendium co-founder and CEO Scott Miller, a former financial planner, believes the report could see advisers transition from their businesses. But rather than exit the industry, he says, they may join the super funds.

“Licensees are facing a major problem,” Mr Miller told ifa. “If they don’t start making it easier for advisers to provide advice, planners may see attractive job openings at super funds and leave licensees to go to the product provider.”

Super funds are already providing advice in many ways. Cbus provided more than 28,000 SoAs last year, Australian Super around 8,000, and REST over 19,000 SoAs from 25,000 digital advice interactions.

Mr Miller believes that, if enacted, the Quality of Advice review recommendations could trigger a hiring spree for the industry super funds who are looking to re-enter the advice industry.

“If that passes, imagine how many super funds will put out job adverts for planners. They could put out a job ad with a very attractive salary package. If I’m a planner on $120,000 a year dealing with an absolute headache with compliance and working in outdated systems, I could go over there to not only support my family on a good package, but to continue in the profession in providing quality advice within that institution through their comprehensive advice channel,” he said.

“Licensees could soon be battling product providers for the talent of planners post QAR if they don’t seek to make it easier for their planners to provide advice.”

Industry fund UniSuper has one of the more sophisticated financial advice offerings among product providers. It currently employs 76 planners and produced 42,571 statements of advice (SoAs) last year.

It offers three different types of advice: general, select, and comprehensive.

UniSuper’s general advice offering is free, and allows members to learn about their super and other products on offer.

‘Select’ advice is for contribution and investment strategies or to review insurance attached to a UniSuper account. This costs between $80 and $120.

Finally, UniSuper also offers comprehensive financial planning, which covers retirement planning, non-super investment, debt management, personal insurance, government benefits and aged care. It costs $310 an hour.

Some of the funds UniSuper planners advise on include AustralianSuper, Aware Super, HESTA, QSuper, Super SA, UniSuper, VicSuper, HostPlus, PSS, SASS and West State Super.