While discussing regulation during webinar hosted by the Financial Planning Association of Australia (FPA) this week, Stephen Jones laid out the party’s plans should it win this month’s federal election, noting three areas in the market.
“There’s the high-net wealth individuals who will find a price point in the market irrespective of what we do or don’t do,” Mr Jones said.
“There’s people down there in the lower end or who are in crisis who actually need financial counselling more than they need anything else. I think there’s absolutely a role for government for direct service provision in that area.
“But the vast majority of Australians are in the middle of those two groups and they’re currently not getting the advice they need. We want to design a market that meets their needs.”
Mr Jones conceded that there is no one solution to that design, noting factors such as robo-advice which may play a part albeit not integral.
“There’s a role there. Maybe somebody will come up with a business model that makes it work, but I think the majority of Australians want to… have a conversation with a qualified person who knows what they’re talking about and get some advice,” he said.
“I’m keen on us creating a regulatory system that focuses on that middle.”
During the same webinar, Mr Jones expanded on a recent pledge to overturn current education requirements for the advice industry, saying Labor believes “there is a need for us to put in place a transition arrangement”.
Mr Jones’ comments come after a recent appearance on the ifa Show podcast, where he gave a candid assessment of the financial services industry, labelling the poorly managed “tsunami of regulatory changes” as the main culprit for adviser exodus in Australia.
“There was a whole bunch of changes that were in play, there was a known timeline for it, not going back months or even years. Some of this stuff has been five, six years in the making, how a government could monumentally mishandle a bunch of this stuff is beyond belief, particularly a government that says it’s a good economic manager.”
Listen to the full podcast with Mr Jones here.
I watched an interview with Stephen Jones by one of the mortgage broking associations today. He was very clear and specific on a few issues. In particular he said Labor had reviewed Hayne’s recommendation about removing mortgage commissions, didn’t agree with it, and wouldn’t be proceeding with it.
It was the style of analysis and commitment I was hoping for by Jones in the FPA interview. He was much more vague and evasive in that one however. If Jones does have some clear commitments in relation to financial advice regulation he would do well to publicise them quickly. He had a golden opportunity to do so in the FPA interview and didn’t use it. The only issue he was clear on was opposition to removal of BID Safe Harbour. That’s actually one of the few advice regulation recommendations by Hayne that advisers agree with!
We have no one to blame but ourselves. Unlike the mortgage broking industry who had a single voice we had dead beat FPA and AFA internal fighting and left us with no single voice.
Stop supporting so called industry bodies that actually don’t support advisers.
Stephen Jones did not address what they propose to do regarding our compliance burden – not that he was asked!
I remember the FSRA changes to stop the likes of Storm financial situation from ever happening again, all Bill did was benefit his mates in the Union Super funds (which he made exempt). Nothing in that legislation would have stopped Storm from their activities, just made extra paperwork for no benefit
All Politicians lie to get votes, if they say good morning, look up, its probably a terrible one
these donkeys brought out FOFA which made things worst.
In 2013, Bill Shorten adhered to the legal advice he was previously provided by Treasury & senior counsel regarding the quarantining of grandfathered commissions in relation to the FOFA legislation.
The reason was the adviser had a pre-existing contractual right to the income and it would only be banned going forward.
So, Bill Shorten did the right thing.
When the current Liberal Govt elected that ongoing grandfathered commissions should be banned entirely retrospectively, they went against documented legal advice and sacrificed not only advisers but hundreds of 1000’s of clients receiving advice and service at a cost effective basis.
Funny though that Labor didn’t stand up at the time and reject this move even though they had previously agreed to quarantine these based on significant legal advice.
….and now they want to be our friend !
What a typical politician. Blame the other party, despite your party designing the whole mess in the first place, and ignoring every opportunity to speak up against the ridiculous level of regulation being rolled out. Further everyone knows the ALP would have done exactly the same if not worse. Then claim you have a clear plan, and proceed to demonstrate that you have no plan at all. The Libs are bad, the ALP are far worse. What chance does the profession have?
“Maybe somebody will come up with a business model that makes it work.” How, we have all been trying but the regulations make it to unaffordable.
Right, so when Chris Bowen came out and said the ALP would implement every single piece of the Hayne report without having seen the final version, how in the world did you and the ALP envision advice becoming more accessible and affordable to the middle ground instead of the opposite? Or is there an election coming up soon?
One of the few good ideas Hayne had was to get rid of the BID Safe Harbour. Disappointingly, Jones said he would retain it.
Clear plans..Clear plans to exterminate me. Advisers can fight with Accountants for the scraps & have the ultra ultra hi net worth clients. They’ll be no changes at all to legislation,after all those clients can afford to pay to sign 20 forms about nothing.
Super funds using carve outs and Apps can have the majority of Australians on average wages, including wealthier Australians, and of course expansion of free counseling services.
I think my business dealing with wealthy School teachers, public servants, hi income earners is DEAD. I changed my business model moving away from ordinary Australians and now I’m the one doing the moving out of the industry.
Nothing new to make me come back into financial planning, having left eight months ago. It would be really useful to return to being a financial planner as a complement to my new profession. So I did the Fasea exam, kept the bare minimum FPA membership. Do the CPD points to retain CFP. Just waiting and waiting with low expectations of anything sensible happening.
Almost no Labor politicians have ever worked in the private sector. Albo has never had a job outside of Politics – if that is a job.
How on earth would any of them no the first thing about any of this?
Advisers are already professionals – the industry needs to be recognized and portrayed by govt as a profession, and should be a fully functioning profession, with the training wheels, curfews and red tape removed. Leave it up to the profession to govern itself with a dics. body and PI.
So Labor’s clear plans are to tell us about the three different types of people and what they need…
Makes me think they don’t have any clear plans at all…
They have clear plans. They have clear plans to design a market to fix advice to that middle group, but in the webinar and this article he clearly avoided any mention of including Financial Planners as a solution….at least the ones not working in Union Super funds.
Well said.
Agree – but it’s funny how persons who made comments in this magazine in the past 12 months have always blamed the LNP government. Do you think its going to be any better under Labour / greens / independents? Don’t think so. Watch out boys and girls.
No better. No worse. But if Labor gets in then hopefully the Libs will be better once they return, having learned the lessons of persecuting advisers and putting incompetents like O’Dwyer & Hume into important roles.
Labor has “clear plans”?? If they do then Stephen Jones didn’t outline them in the FPA interview. Nothing he said would amount to anything more than “broad intentions”.
If the ALP wants to win more adviser votes then Jones needs to be a lot more specific about their plans for financial advice regulation.