The SMSF Association has argued that specialist training for professionals providing SMSF advice is “critical” to ensure the health of the sector.
In its submission for the Quality of Advice Review (QAR), the peak body said that – in line with the Productivity Commission’s 2018 Superannuation report, FASEA’s Financial Planners & Advisers Code of Ethics 2019 Guide and ASIC’s Report 575 – SMSF advisers should be required to complete specialist education.
“All these reports highlighted that education improves the quality of advice and consumer outcomes. As such, an approved course or accreditation must be completed, and appropriate ongoing professional development maintained to retain that certification or accreditation,” SMSF Association John Maroney said.
“We believe requiring advisers to have specialist advice competencies in certain areas is important to lift the professionalism and integrity of the advice industry.”
Mr Maroney said that research conducted by the group found that 63 per cent of SMSFs were established on the back of a suggestion by a financial adviser, while 81 per cent of SMSFs use some form of adviser, highlighting that the quality of advice provided can affect the retirement savings of SMSF members.
“If members and trustees do not understand their obligations and the time required to manage an SMSF, this can not only result in severe penalties and sanctions, but a lack of effective engagement and management causing significant financial detriment,” he said.
In the submission, the SMSF Association also recommended that advisers have access to “essential” client ATO superannuation reports following the introduction of “multiple” total superannuation balance thresholds and the pension transfer balance caps implemented on 1 July and a comprehensive review of the sophisticated and wholesale investor regime.
Mr Maroney has also called for provisions such as the design and distribution obligations to not apply in establishing an SMSF, adding a new member or when starting a pension.
“The professionalisation of our sector must be duly recognised – a system where suitably qualified professionals provide the advice they are qualified to provide. Further, they should be able to apply their professional judgement in line with other professions,” he said.
“This involves recognising the various industry participants operating in the financial advice sector and the different types of advice services they provide. Many facets of the current legislative framework are based upon the provision of financial product advice and assume industry participants are providing comprehensive financial advice.”
What do the other 12 associations make of this?
Is this just a play to have an accountants exemption? The gravy train of SMSF’s can continue. How come the ATO never asks how all these SMSFs were setup without advice?
This organisation is self-serving and ONLY interested in revenue for itself. As one of the founding members a very long time ago, I was ‘audited’ for CPD points and despite doing every conceivable CPD thing I could locate with SMSF points, they failed me because I didn’t attend their (high cost) events and was advised at that time that the ONLY way to meet their requirements was to attend their events because they simply don’t approve enough points outside of their events for anyone to meet the requirements without attending (which were high cost annual conferences or PD days in Melb – I’m regionally based and a day trip to Melb is not viable). So I ditched my qualification. I can only assume the article above refers to their desire to offer expensive events to meet this need they speak of, for their own sustainable futures.
Is it the role of QAR, or any politician or regulator, to “ensure the health of the SMSF sector”? What about ensuring the health of the superannuation sector? Or ensuring the financial health of Australian consumers? The SMSF sector has ballooned into a runaway gravy train. It is far larger than necessary. Most consumers with an SMSF would be better off in a public offer fund. There are already more than enough “SMSF professionals” to service those consumers who really need one. Australia needs less SMSFs, not more SMSF training.
Yep, the best thing the government could do would be to leave us alone for the next 10 years and forget about these types of bright ideas from associations. The FPA tried this path on to build their membership base thinking the CFP would get the carve-out only to throw their members under the bus.
Not saying we should or shouldn’t do other courses to specialise, but this article is exactly what is wrong with this industry.
We have an industry association (one of many) telling Government that we should do further qualifications in their little patch of the world. And guess what, they just happen to run the course they are trying to get us all to do – and you can only do the course if you pay an annual membership fee.
There is such a conflict of interest in all areas of this industry, that makes me wonder will we ever make any progress.
Spot on there are so many self interested people pushing the barrows in canberra it looks like a building site. Fragmentation makes us really very weak, we need a peak body to speak for advisers. Why cant the fpa, afa, aiofp etc get in a room, pick one person from each association and get this peak one organised. Vote on the big ticket items, get agreement and drag us out of this quagmire. Then they would have all of our support. They would be listened to, maybe even do the right thing my us, the ones that pay the fees.
Totally agree John, the LIBERAL bullies are gone and its time to take a more practical and pragmatic approach to the advice universe.
John Maroney making sense again.
Why do we need academics and bureaucrats in this process?
Financial advisers are not product issuers and are paid by their client.
They have a common law obligation to do right by the person whos is paying them to do a job.
SMSF and other specialist areas should be recognised for what they are.
Accountants should be able to advise clients on the tax benefits, both short and long term, of investing via a super fund structure. That doesn’t have to include what to invest the contributed cash into. That role can be attended to by another suitably qualified expert in investment who is happy to leave the legal and tax advice to someone else more knowledgeable in that area.
As Stephen Jones has said, the idea that one size fits all just doesn’t make sense.
We need to be careful what we wish for in this space, the SMSF accrediation may not be considered sufficient by the universities hingry for course fees…which the regulators will no doubt defer to when deciding to implement your “more education / higher education” suggestion…