Jones affirms ‘status quo’ on super fund SOA checks

Speaking on a Financial Services Council (FSC) post-budget briefing on Thursday morning, Financial Services Minister Stephen Jones responded to concerns that the first Quality of Advice Review (QAR) bill would result in super fund trustees being required to review every statement of advice (SOA) before it can charge the cost of advice against a member’s interest in the fund.

“What we’re trying to do here is clarify the law to affirm the status quo, because the status quo was put into question as a result of Michelle Levy’s review and she put a spotlight on what she thought was the deficiency within the law to support status quo practice,” Jones said.

“What we are attempting to do is to affirm status quo practice, not to change it but to affirm status quo practice.

“So, where funds have arrangements with advisers for the payment of advice fees in relation to retirement income, we want to ensure that status quo is maintained and supported by the law. We’re not trying to upset the law, not trying to change any existing practice.

“How exactly do they do that? That’s where we’ve come to the situation where some of the funds are asking for copies of SOAs and you guys have got to go through and redact personal information that you don’t think should end up with a trustee.”

He added that there is an immense amount of work that needs to be done in the advice space and not a lot of parliamentary sitting days to get it done before May next year.

“I want to get this done – all of the pieces. I want to get to the big work that will make a significant difference, [which] is the next tranche of work and I want to focus love and attention on that,” Jones said.

“I saw this was something that should have been [non-controversial] and working our way through it. That’s not to diminish the issues that you’ve raised, but I really do want to impress the pressure that we have upon us about delivering the big piece and getting that through before May next year.”

The minister also noted that the government believes it has “got it right”, but it is important to “draw the regulator into this conversation as well”.