Speaking at the AFR Super and Wealth Summit on Tuesday, shadow treasurer Angus Taylor said that in order to create a strong retirement system, the government needs to look beyond superannuation and solve the “absolutely critical” advice challenge.
“The Coalition reiterates our commitment to fast-tracking implementation of the Levy review, in full, in government,” Taylor said.
“I can confirm that my colleague Luke Howarth and I have sought briefing from the government on the next tranche of the legislative response.
“And we call on the government to work with us and pass a bipartisan bill before the election.”
The likely date for the next federal election is May 2025 and, with the caretaker period ahead of any election, that gives less than six months for any legislation to be introduced, consulted on, and passed through Parliament – all with a Christmas break in between.
However, Taylor argued that “we cannot let the promise of [the Quality of Advice Review] slip through our fingers”.
“It will help advisers, it will help consumers, and it will help super funds meet their Retirement Income Covenant obligations,” the shadow treasurer said.
“We are acutely conscious that there are more challenges than just implementing the review – but it is a critical enabler to effective digital advice and supporting product modernisation that is overdue.
“We hope to see this settled in this term of Parliament.”
Advice a ‘foundation stone’ of retirement
Also speaking at the event, Financial Services Minister Stephen Jones agreed that any effort to improve retirement outcomes also needs to involve improvements to Australia’s financial advice laws, noting that funds “have almost unanimously” said the current laws are “holding them back and leading to bad outcomes for members”.
“The financial advice laws in the country are not fit for purpose,” Jones said.
“It’s too expensive. Too hard to access. And too strangled by red tape to be helpful.”
Pointing to a range of numbers around access to advice, such as almost three-quarters of Australians aged 18 to 34 having unmet advice needs, the minister cautioned that if super fund members “cannot get advice from regulated sources, they may be led by ‘finfluencers’ and ‘armchair’ commentators to expose themselves to the dangerous world of scammers”.
“No one can defend the current financial advice laws when presented with these outcomes,” he said.
“This is an acute challenge for the superannuation industry. We have over 5 million Australians at or approaching retirement and they are hungry for advice and information. And so we have set out to implement the most significant reforms to the financial advice laws in a decade.
“We are committed to improving the retirement phase of superannuation. And the foundation stone for this project is helping more Australians access quality and affordable financial advice.”
Jones was bullish that, despite coming under fire for the government dragging its feet on advice reform, the next tranche would indeed be introduced ahead of the election.
“We have delivered the first tranche of reforms, and the next tranche of reforms is being drafted and prepared for introduction,” he said.
“In this tranche of reforms, we will modernise the best interests duty and remove the safe harbour steps. We will reform statements of advice so that they are actually usable by the consumer who paid for it to make informed decisions.
“And we will create a new class of adviser who will be able to provide simple and safe advice. Advice will be safe – so that we protect Australians from bad advice. Advice will be helpful – so that it is useful and fit for purpose. And advice will be quality – so that it delivers the best outcomes for Australians.”
Stephen Jones needs to resign immediately.
He clearly has a direct conflict of interest as does every single Labor politician when it comes to Financial Services and the millions of dollars they receive from re-directed Industry Fund Directors fees paid to Labor Party Trade Union entities every year.
The last thing they would ever want to do is stop the cash flow from the rivers of gold.
Labor is promising to create a new class of unqualified advisers for the industry funds after Frydenberg and Hume crippled actual advisers with effective revenue caps on insurance and buried the sector in red tape for the sins of the large financial institutions. Policy-making in this country is a joke.
“And we will create a new class of adviser who will be able to provide simple and safe advice. Advice will be safe – so that we protect Australians from bad advice. Advice will be helpful – so that it is useful and fit for purpose. And advice will be quality – so that it delivers the best outcomes for Australians.”
Exactly right, All of Canberra Pollies, Regulators and Bureaucrats have totally stuffed Advice mass BS over regulation in Australia.
Rather than free up Real Advisers with 70% less Red Tape, to give lots more Advice.
The major parties both propose Uneducated, Unqualified BackPacker, single product flogging sales agents.
It really can’t get any more stupid than Canberra.
Not just Labor – the liberals back this legislation as well. They are all getting donations from large institutions with an interest is selling their products direct to consumers.
The industry needs to lobby the cross bench (apart from the Greens) to get itself heard. They need big issues to generate interest. In particular, we can use the otherwise worthless findings of the Hayne Royal Commission to highlight the conflicts of the major parties with their support of vertical integration in the industry.