In his opening address to the Association of Independently Owned Financial Professionals (AIOFP) conference in Bangkok on Friday, executive director Peter Johnston said the Fadden result and a swing back to the Liberals have done the advice community a “huge favour”.
“It is no longer a one-horse race at the 2025 election, which is a good thing. It means both major parties will be doing what all parties must do going into an election – tout for votes,” Mr Johnston said.
The Fadden byelection, which saw Liberal candidate Cameron Caldwell secure the seat with a 2.8 per cent swing in the LNP’s favour, came about after shadow treasurer and shadow financial services minister Stuart Robert announced his retirement from federal politics in May.
According to Mr Johnston, the result is also a positive outcome for the nation’s democratic health, stating that a “competitive opposition is needed to retain equilibrium”.
“If you then throw the decision by the Albanese government to passionately back the ‘Voice’ referendum, some anti-ALP feelings developing in WA, rising living costs, interest rates and a worsening global economic climate into the political melting pot, it suggests the 2025 election will be an intensive and closely fought battle,” he said.
“This is a great outcome for the AIOFP, it presents a significant political opportunity to again capitalise upon and it just may mean the WA-based advisers will play a pivotal role in who wins the next federal election.”
Despite the desire for a close-run election, Mr Johnston added that the work that Financial Services Minister Stephen Jones is currently embarked on for the advice industry should remain a priority.
“Currently we have a government systematically dismembering the draconian regime left behind by the Liberals, the Liberals almost apologising for what they did and now a close election looming that gives the AIOFP leverage to chase and demand other amendments – an almost perfect political scenario after a decade of fear and uncertainty,” he said.
“We suggest letting Minister Jones finish the ‘hot mess’ amendment schedule and start campaigning for other issues in mid-2024, we don’t want the minister distracted from this task.”
Arguing that there is little value in sitting on the fence politically, Mr Johnston again advocated stronger political lobbying, adding that he wants “all political parties to fear and respect our political capital”.
“Canberra has realised that the advice community has 15,000 advisers with 200 clients each – that’s 3 million out of 18 million voters over the age of 18 years, around 17 per cent of the voting population. Critically, we have a strong money/political relationship with the clients … that’s the politically scary piece for the politicians,” he said.
“The advice community is in a strong politically strategic position to now eliminate the ASIC levy, get tax deductibility of fees and dispose of any residual compliance issues leading into the 2025 election, this however needs either amended or new legislation – always a tough and time-consuming task.”
Turning to the task of drumming up tangible and monetary support for lobbying efforts, Mr Johnston reiterated his earlier calls to establish an election fund to “influence outcomes” – this time backed by a resolution.
“Being realistic, the advice community is not united and unlikely to be in the short to medium term. However, the AIOFP has 3,500 ARs and with theoretically another 22 months left until the next election, if we all put away $10 per week over this period we will have around $3.08 million to play with – that will carry some serious ‘weight’ in Canberra,” he said.
“We hope on Monday to get a unanimous resolution from all conference delegates to support the cause and that will hopefully arouse support from all members.”
Mr Johnston previously called for advisers to band together to lobby the government following the release of the government’s response to the Quality of Advice Review (QAR) in June.
“It is time we learn from it and finally do something about it,” Mr Johnston said.
He followed this stance up at the beginning of July on the back of the ASIC levy announcement, saying that the outrage of members over the increase prompted the association to raise its issues with Mr Jones.
“We have decided to commence some lobbying on this levy issue due to the pain and anger this is causing many members, we have not seen this much frustration since the grandfathering revenue ban was announced,” Mr Johnston told members.
“You may recall we suggested commencing this strategy leading into the final 12 months of this term of government and not put another issue on the minister’s plate, but we will do both considering the circumstances.”
How long should Jones be given to fix the “hot mess”? So far, Jones has done exactly the same as Hume. He has made lots of sympathetic noises, while delivering sweet FA. He seems far more focused on allowing union super sales reps to give poor quality conflicted advice, than he does on making professional advice more accessible to consumers.
Are adviser groups falling into the same trap with Jones as they did with Hume? If Jones hasn’t delivered tangible improvements to professional advice regulation by May next year (2 years after Labor came to power) then it’s time for adviser groups to admit they have been conned again, and do everything they can to unseat the govt at the next election.
Let’s not forget that Jones went to the last election espousing a clear list of problems and quick wins. Two years is far too long to wait for action.