In a closed-door meeting on Tuesday morning, Financial Services Minister Stephen Jones unveiled the government’s anticipated response to the Quality of Advice Review (QAR) to a small audience of superannuation fund CEOs and senior industry executives.
Mr Jones revealed the government will accept 14 of the 22 recommendations made by QAR lead Michelle Levy, with the legislative response divided into three streams.
Calling the Labor government “asleep at the wheel”, shadow treasurer Angus Taylor said the QAR response failed to address major challenges to improving access to financial advice for Australians.
“While overdue, the government’s ‘stream one’ reforms are welcome, but the narrow acceptance of the medium-term agenda will leave Australians with less access to financial advice and advisers working outside the superannuation system in the cold,” Mr Taylor said.
“The response to the Levy review was a key opportunity to drive better retirement outcomes and productivity in the economy but the government has shied away from making any genuine improvements.
“Narrowly implementing the Levy review risks undermining innovative investment and product design within the financial advice sector and creates an unequal playing field between superannuation funds and the remainder of the financial services sector.
“This is all the more galling due to Assistant Treasurer’s decision to announce the changes in a closed-door meeting of superannuation fund executives.”
The opposition called on the government to adopt in principle all the recommendations of the QAR, and to “work constructively with the Coalition on the implementation”.
“This is a vital deregulation measure that will deliver wins for consumers, support innovation and investment in the financial services sector,” Mr Taylor said.
The shadow treasurer stressed his support for the overall review, calling it a “considered and timely” review that would provide “safer, simpler, and cheaper financial advice to all Australians”.
“Instead, the government has delayed, second guessed the reviewer, and after failing to deliver a response in the budget, delivered a two-page response to what should be a seminal productivity roadmap for our financial advice sector,” Mr Taylor added.
The statements echo the thoughts of former shadow assistant treasurer Stuart Robert, who called the QAR an “outstanding piece of work” when he appeared on the ifa podcast in May.
“It’s one thing for the Labor Party to hold the financial services industry, to hold them at arm’s length, to think little of them, which is what the government does. But it’s another thing to punish everyday Australians by not allowing them to get the advice they need. The government’s got to be better. Minister Jones has got to wake up and implement this,” Mr Robert said at the time.
Following its release on Tuesday morning, industry groups have largely supported the government’s response.
“The government is right to prioritise its ‘stream one’ reforms, which will lower the cost of providing financial advice and improve consumers’ experience when receiving advice,” said Financial Services Council chief executive Blake Briggs.
The Association of Independently Owned Financial Professionals (AIOFP) was also strongly in favour of the response.
“We suggested from the QAR beginning that Minister Jones will cherry pick the ‘no brainers’ and bin the rest, which has happened,” said executive director Peter Johnston in an email to the AIOFP member base made available to ifa.
Sounds like Angus is just sad his mates in the banks didn’t get free access to the gravy train.
The Liberal party effectively destroyed the financial advice sector, destroyed Financial Adviser’s businesses, destroyed their sense of self worth and self esteem and destroyed 1000’s & 1000’s of advisers mental health over a sustained period of a decade and did absolutely nothing to listen effectively and to act.
The Liberal Party ( as the party of small business !!!) did everything they could to ignore and discriminate against small business and their long term political supporters in this space.
Too little too late Angus. And to think you are a Rhodes Scholar, with Economics as your background. Where were you 5 years ago.
LNP overall and including Angus Taylor, Frydenberg, Hume, O’Dwyer & Roberts,
You the LNP have no rights whatsoever to comment in a negative away about Financial Advice regulation.
[b]The LNP over your last 9 year term was a total disaster to Financial Advisers and consumers.
From ever increasing BS useless Red Tape Regulation continually introduce with utter arrogance and complete lack of clarity resulting in mind numbing duplicity and regulatory time wasting rubbish. [/b]
It will be near impossible for the LNP to be trusted again by Real Advisers.
I can appreciate how some risk advisers feel the reduction in insurance commission from 110% to 66% may be bad for there own pocket, but for the other 99% of advisers that moved to a fee-for-service arrangement a decade earlier, they were well prepared. Seems like you have a short memory in that the LNP and their multiple attempts at reform were blocked in the Senate at every step by Labour. The biggest damage to Australians inability to obtain affordable advice was Labour and the introduction of FoFA and complicated fee disclosures. Seems like you didn’t get the message 10 years ago that commissions were out of step with the rest of society’s expectations.
To be fair, Taylor and Robert have mostly [b]said[/b] the [b]right[/b] things while in opposition. But it doesn’t absolve the fact that Frydenberg, O’Dwyer and Hume [b]did[/b] mostly the [b]wrong[/b] things while in government.
I completely agree. The LNP had 9 years to improve the Financial Advice industry, but they all but destroyed it over that period of time.
1. Didn’t listen to advisers
2. Listened to big business (Banks etc), supporting the vertical integration systems
3. Penalised the Advisers for the sins of the Vertical Integration companies.
4. Brought in more BS regulations to make it more difficult for advisers to work
5. Empowered ASIC as an authoritarian overlord to litigate against advisers for minor issues
If Stephen Jones can fix the LNP death trap for our industry, I will never vote Liberal again… and I’ll actively explain to clients why they should also support Labor.