To help ensure Australians can continue to have access to affordable and professional advice, Treasurer Josh Frydenberg has announced “temporary and targeted relief” for financial advisers by cutting the cost of recovery levies charged by the Australian Securities and Investments Commission (ASIC).
Moreover, while the temporary relief is in place, Treasury is expected to kick off a review of the ASIC Industry Funding Model in 2022, to ensure “it remains fit for purpose”.
The current relief will see ASIC levies charged per licensee remain at $1,500 – a substantial reduction relative to the level estimated in ASIC’s 2020-21 Cost Recovery Implementation Statement of $3,138 per adviser.
This would ultimately see ASIC levies charged for personal advice to retail clients restored to their 2018-19 level of $1,142 per adviser for the next two years (relating to 2020-21 and 2021-22).
“The sub-sector as a whole will pay an estimated $46 million less in ASIC levies in 2020-21 alone, with further savings flowing in 2021-22,” the Treasurer said.
“The freeze in the per adviser levy will provide financial advisers with the certainty they need over the next two years to deal with the impacts of COVID-19 and further regulatory reforms making their way through the Parliament, including the introduction of a Single Disciplinary Body and a Compensation Scheme of Last Resort.”
The Financial Planning Association of Australia (FPA) was quick to applaud the government’s announcement, noting the news “will provide some certainty and stability to financial planners”.
“This is a significant milestone for the FPA and our members as we have been calling for a review of the flawed model since it was first proposed and then introduced three years ago. We would like to thank the Government for listening to our concerns and those of our members,” said FPA chief executive Dante De Gori CFP.
Similarly, the national president of the Association of Financial Advisers (AFA), Michael Nowak, called the relief well timed.
“This is a much-needed move in the right direction, and I want to thank the Treasurer the Hon. Josh Frydenberg, MP and the Minister for Superannuation, Financial Services and the Digital Economy the Hon. Jane Hume and the Government for finally listening to the AFA and the advice sector,” Mr Nowak said.
“This is a significant first step in starting to address the practical impact of the reforms on the ability of financial advisers to offer everyday Australians sound financial advice to give them financial security and independence,” adding that a lot remains to be done to ensure financial advice can still be delivered in an efficient and cost-effective manner.
Dante your our FPA hero not! The heavy lifting may have been done by some FPA members but it was most likely done by self employed advisers and planners being members of other industry associations (with some like me being former FPA members) thanks to your previous inactions that led to red tape inequities like this!
To all the FPA haters on this page (and there’s a few, but seeming the same old few, the same few who are also against fee for service, still banging on about FOFA, still hoping the FASEA requirements will go away and still think having to turn off commissions from clients they haven’t seen in a decade is unfair…).
1. Many of you are not current members and so are sharing outdated views based on your own pessimistic view of the world generally.
2. How about back up some of your assertions that the FPA is for Industry Funds with some facts, data or even the faintest context instead of just spewing our the same old line over and over again without any rational link as to why they would be or why you think this (their annual reports and revenue and changing membership structures puts this to bed in about 2 seconds)
3. Perhaps try and understand the concept that lobbying, when successful, has no proof of outcome, because when you ‘win’, you cannot advertise it, because often it means that someone in politics has watered down their plans, changed their mind or conceded they were wrong, and as ALL politicians are driven largely by ego, they cannot stand for this to be publicly advertised, so the FPA’s wins remain behind the scenes, and to shout them from the rooftops would only serve to upset the very people they lobby and thus close the door to any future lobbying. By its very nature, the most successful lobbying is never known about other than to those who are a party to it. Just because you don’t see it doesn’t mean it’s not happening or not being done successfully.
Serious question. Can you point to one win that was the result solely of the efforts of the FPA.
“How about back up some of your assertions that the FPA is for Industry Funds with some facts”.
Ben Marshan, Dante and FPA all support Intra Fund Advise. See Ben and Dante answering questions at Parliament if your unaware for call Ben or Dante directly.
By the way, Dante and FPA did not support Commissions (see RC). I guess they did not like the fact that there was no requirement to provide any service – but like Intra Fund Advise Fees. Retail vs Industry.
Born again are often hiding something – you?
The FPA takes more money from the big licensees than it does from individual advisers. Conflict much?
Loss of commissions, LIF, FASEA, intra fund advice, ASIC fees…. What has the FPA actually achieved?
Before we all give each other a slap on the back and say well done…I’d like to draw to your attention that it was most likely the work of the Institute of Chartered Accountants (CA-ANZ). Don’t think for a minute that the Government listens to the Advice industry or Financial Planners. We’ve got a bloody lot of hard work to do.
LOL! You’re kidding right? Do you have any idea the work done by members with local MP’s through the FPA campaign? Our chapter alone saw our local MP directly communicating with the Treasurer requesting for a review. I assume this happened at many many chapters nation wide. Simultaneously. Do not discount the effectiveness of the FPA campaign on this one.
Unlike the FPA, my membership in the AIOFP is proving to be an excellent investment
ASIC stated the indexation increased due parties that exited the industry (Banks) and specifically General Advice provided by a Westpac Call Centre… Let’s look at the FPA’s approach…firstly keep in mind they want to kill face to face advice by supporting teh expansion of intra fund advice to please the likes of Hesta Call Centre and Aware Super…..1) they wrote to Treasury complaining the “indexation” itself was unfair …when members said “come on do better” all they did was encouraged other members to write to Politicians and provided them with a template. A template that merely protected their puppet masters, so as to not to say anything against the real cause of this levy. Don’t be fooled. The parties that did the hard yards were the AFA, the AIOFP, the Stock Brokers and Financial Advisers Association,.
Please provide context to back this statement up…
“Let’s look at the FPA’s approach…firstly keep in mind they want to kill face to face advice by supporting the expansion of intra fund advice to please the likes of Hesta Call Centre and Aware Super…..”
Why would they do such a thing? Have you actually read the FPA’s annual reports and financials?
Funding from institutions is shrinking as a % of their total revenue and pales in comparison to member fees from individual advisers and small to medium sized businesses. The FPA relies on our continued membership for the overwhelming majority of its funding so any assertion it would favour any other group is nonsensical and also totally at odds with the ACTUAL data both financially and based on their strategic initiatives and what they spend their time lobbying for and against.
Thanks AIOFP for having the guts to really apply pressure to Frydenberg, Hume & LNP.
Their treatment of Advisers and ever increasing BS Regs & Red Tape costs over last 8 years has been disgusting.
Finally they just maybe starting to listen as Real Advisers muster themselves and clients to vote down Frydenberg, Hume & LNP.
WE MUST KEEP THIS FIGHT GOING ALL THE WAY TO THE ELECTION TO GET MORE LONG TERM RESULTS.
…and there is an upcoming Federal Election.. ethics 101 (MP style!)
I love the laugh that these destructive politicians who cannot run a chook rafflelet alone an economy are referred to as The Honourable…..Thanks AFA
Treasury is expected to kick off a review of the ASIC Industry Funding Model in 2022, to ensure “it remains fit for purpose”…. ummmmm has it ever been?
Funny how when an election is on the horizon the Libs do a backflip. Note that it’s ‘temporary’ only though…just temporary enough to get to the other side of the election 🙄
And here I was thinking it was just me that thought that. Cunning as a sewer rat is Frydenberg.
We were burned before and our memories of broken liberal promises after the last election are still fresh in our memories!
Perhaps, but you’d be lucky to get 1% of financial professionals voting for labour regardless…
Maybe the 99% and their clients will vote for independants and hopefully stop either side of Govt from being able to bulldose their desires into legislation.
Finally some good news – amazing that ASIC thought that $3,138 was remotely defensible. Regulation is the biggest threat to the industry and regulatory-related fees are the biggest indirect cost
Great work Josh….now you can move on to the regulatory nightmare you have created for the industry and untangle the web of duplication and overkill e.g. FDS’,Opt-in, Service Agreements, Fee Consent forms, annual advice documents etc., etc.
Gee it doesn’t take much for the FPA and AFA to give glowing praise to the Government. This is temporary relief only, and given at a time when the government are imposing ridiculous additional red-tape on advisers. Clearly those in power are a long way removed from the delivery of financial advice and are more interested in building their personal networks and CV than fighting for their members interests.
This is a very welcomed announcement today but my skepticism, due solely to the way this very same bloke through his actions the last 5-6 years has relentlessly targeted and slammed advisers, senses a much deeper and darker purpose – namely re-election before he puts his final nails into our coffin.
I’m treading very cautiously – despite this announcement.
Well done Treasurer. Great decision
Josh is feeling the heat from the polls. Newspoll has them at 46-54 on two party preferred.
Well done Treasurer….pffft! He’s got that much blood on his hands, its unfathomable you could suggest that.
There is always an ulterior motive with this bloke. I was staunch Liberal my entire adult life, never again while he’s there.
After doing nothing for advisers since FOFA it is great to see the FPA getting out there and congratulating the government. The FPA and the Libs have done more to destroy finanancial planning that FOFA ever did.
This is, to put it politely, wrong. The FPA has been doing a lot of work behind the scenes, more effective than those using bullhorns only.
Are you a troll? No matter what the news, the Liberals and the FPA are always wrong for you. That is not how professionals operate.
I agree with the Ex FPA…We have to do everything we can to get people to leave the FPA. The FPA represents Industry Super Fund, product manufactures The Bare foot Adviser. Somewhere…way down the botton of that mix is the Adviser that doesn’t work in a call centre. The FPA’s pathetic action on this reflects this association. How can an Adviser that cares for their clients belong to such an association
Based on what? This is a silly assertion and totally at odds with the FPA’s revenue sources and strategic plans. Sounds like you’re not a member though, so I guess you wouldn’t really know what you’re talking about.
Its always been the FPAs strategy to have advisers go through this process, however when they should have had a spine and stopped the government from going too far they failed and failed dismally.
That failure is now seeing the FPA railroaded as the politicians can see there is no spine to stand up to them.
Certainly not a representative body I will have anything to do with again.
Errr, the FPA get as much if not more from the big licensees than they do from individual advisers.
Regardless of what the FPA has done “behind the scenes” the outcome has been FASEA, LIF, ASIC fees and public attacks. In other words, the FPA has been a failure. If they have actually done anything “behind the scenes” it has failed.
It wouldn’t have happened if we didn’t make a consistent objection! Let’s see what happens next…
Yes!!!!