Following the August 21 Federal Election, which Government will deliver a better financial services industry for advisers and consumers?
- A new Coalition Government (88%)
- It will make no difference (5%)
- A returned Labor Government (4%)
- Not sure (3%)
In the midst of the Federal Election campaign, we are asking advisers to consider which party they believe will better serve the diverse interests of the financial services industry if they win Government.
Our poll question is:
Following the August 21 Federal Election, which Government will deliver a better financial services industry for advisers and consumers?
The answer to this question may be simple for some, but difficult for others. For example, would a new Coalition Government be better for advisers and the industry itself, but leave consumers less protected? Would a returned Labor Government serve the interests of consumers, but at the expense of a less competitive financial services sector?
Successive Federal governments have agitated for serioius financial services reform. For the many who have spent some time in the industry, they may recall the substantial changes made by the previous Coalition Government: the Financial System (Wallis) Inquiry, leading to CLERP 6 recommendations, leading to the Financial Services Reform Act, leading to unintended consequences, leading to the FSR Reform Amendment Act.
The present Government has instituted three key inquiries in its first term: Ripoll, Henry and Cooper, where many recommendations from all three will inevitably be legislated if the Government is returned. But which recommendations? What will be the impact and/or consequences?
Is it possible that one Government can enact policies that will see a better outcome for all elements of the financial services community, including industry funds, retail funds, life companies, advisers, licensees and of course, consumers?
Or is it impossible, almost by definition, that one Government can structure a financial services industry that will be to the benefit of all these sometimes conflicting elements?
To what extent will advisers be swayed by one of the key policy differences between Government and Opposition, namely that a Labor Government will legislate to control, to an extent, how an adviser is remunerated, but a Coalition Government has said it will not?
We are not asking how you will vote on August 21. Your answer to this poll question may indeed reflect how you will vote, but there may be other considerations that will lead you to cast your vote a different way.
Tell us what you think. As always, we will appreciate and value all (measured) comments you may wish to add…
Add your comment now
30 Comments
Labour and it’s Faceless Union Masters have been a disaster for Australia. A retrun of the Labour Government will further entrench the Union power and takeover of the Austrlia Super Industry and the public retirement savings being controlled by these Union power brokers.
Wow, only 3% of the votes so far support the re-election of a Labor Government. The new Julia may very soon be the forgotten Julia (with any luck).
The indusrty Funds and unions don’t like competition. Return Gillard and the consumer will be the loser as the competition will be eliminated, we will all go out of business.
I don’t know if there is anyone else out there that was secretly jumping for joy when the polls came out last week showing Coalition as having a real chance of winning. I had never dreamt this was possible and had resigned myself to likely draconian legislation that would follow under a Labour government. I only wish that I lived in a marginal seat so that my vote would make a real difference.
The govt wants super to be their own “assets under management”. Earnings tax at 15% on an ever increasing pool (read 12% SG) of savings, will only give them nore money to splurge. I say its a conflict of interest.
I have to ask the question why has any government been allowed to have such a significant control/input into the financial services industry. The legal, accounting & medical associations have been the monitoring bodies for many years yet have the same bad eggs within. The government is there to govern not to control nor manipulate society just to appease the few who have an adgenda. The general public would consider it more important that they be allowed to contribute to super at a higher level to be an independent retiree than the silly debate over commissions. Lets get the priorities right and leave the management to the appropriate bodies who are left with their hands tied behind their backs.
The current Labour government is completely out of touch with reality! They have no concept of rational real world economics. They believe that a government, labour employed union members, are best placed to provide serves to the consumer and everyone else in the private inductry is an evil capitalist in need of ‘re-education’. They are still fighting the class wars of them and us of the last century. Perhaps they should come clean and own up to the fact that they wish to follow in the footsteps of the Brazil government and confiscate our superannuation all together - for the greater good - of course. Or are they simply going to ensure that everyone is in a mandatory industry fund that pays donations (trails?) to the labour party. Of course we wont mention the plans for superannuation equalisation between all australians, or even a progressive taxation of superannuation. They will not of course not understand why national superannuation savings collapse because they believe that such reforms will of course drive greater savings.
I thought we elected a government to provide direction in policy to enable Australia to “move forward”. Instead we get a government that cannot be trusted to run a school canteen let alone the economy. The shear waste if of mammothly breathtaking. The current government has sought to damage the viability of this great industry and its participants by ensuring a “dumbing down” of advice provides government with a windfall in revenue from a naive community. The damage to business owners in this industry will be massive with valuations of businesses plummeting effecting the retirement outcomes for thousands of business owners in financial services. The run of effects are massive as people we have as clients will end up with lower retirement funds and taxes will rise over time to pay a massive social services bill which the economy cannot afford. These are morons who do not understand the economy and cannot be trusted with money. They have a responsibility as the custodian of Australia’s wealth to act for all and take this country forward with a sense of vision. They have no proved that they have no vision for Australia, just a renegade and ill thought policy of pure Socialism to pander to union bosses and if they do not act in their interest the leader can be removed. They have demonstrated that they are acting for unions and as a result if re-elected, they will damage this economy. Rising interest rates, inflation will be the concern going forward and if the world is to experience the “second wave” of recession or deflation, they will take this country into the abyss. Please Please lets :move forward by removing this wasteful and incompetant government from office. They are simply not fit to govern and the people of this country both now and future generations cannot have our lives ruined by idiots like this.
Labour it would seem is intent on destroying the Financial Planning Industry!! This latest Gillard statement (to make us look like theives) that a 30 year old today after 37 years invested in Mysuper will have an extra $40,000 in their Super fund at Retirement. Is a vote getting load of Crap, What is not stated is that $40,000 in 37 years time will be worth approx $900 in todays values, divide that by 37 and you get the great saving of
$24-32 per year.
I am sure we are paying far more than that in increased costs for Electricity, gas and Water.
Like Fuel watch and Grocery watch, etc, etc I guess in the future they will change the name to MyFault Fund ( and not Mysuper the Default Fund)
Its pretty obvious by this Survey, how Financial Advisers feel about Labour.
As long as the value of advice question continues to lack traction with all parties except existing satisfied clients and ourselves there is not much hope of our industry being heard seriously enough to change any recommendations made by Cooper. Labor will be returned and Chris Bowen will be given the opportunity to add MySuper to his shopping trolley of failures along with his whistle blower supermarket and fuelwatch legacies.
As usual it will take the inevitable disaster to bring about change.
Blame the FPA for getting into bed with labor. Saying yes to everything labor wanted so the FPA could build its own power base, led by Joanne Bloch, who feathered her own political nest and moved on.
The ongoing interference in the financial markets by a government with zero financial capacity is laughable–the only forward movement from this will be staright into the hands of the major banks and institutions.Jobs for the boys, set up another government department so that they can manage the dodgy employment figures.If this public really beleive a labour government will deliver them from evil-have a look at their immediate debt situation-they may need the super money to bail them out or get back to surplus.You cannot trust Miss Beige and Uninteresting for longer than three months,.
The people in this government do not have the ability to understand the real issues (even if they wanted to)and rely on reports by consultants and academics whose theories may work in text books but not in the real world. They do not have the capacity to understand the unintended consequences of their reforms and instead of genuine consultation with industry try to dictate to industry. They do not respect that it is industry and business who understand the issues better than any government or review can and the least they can do is to really listen instead of pretending they do.
I see that 3% think labor will be better for our industry but not one has made a comment about how. They’re either labor stooges or morons (much the same thing) and I’ll guarantee they don’t run a financial planning business! The 3% who aren’t sure aren’t much better.
Thank god the majority (90%) of planners at least realise the reality of this. Labor = the end of small “indepenant” advisory firms.
Great comments above, couldn’t agree more.
I don’t think the Govt realises the impact that financial planners have. The worst drop in the polls happened with Rudd in power immediately after their announcement of the banning occurred. It was down hill from there. With reforms everyone expects a fair go. All stick without carrot is a disgrace. Even worse, the outcome was the storm financial model being the model the government prefers. Large upfront and cut the client loose. Every planner, every planners spouse, every planners voting child, an extremely high portion of the independantly run planning practice clients will be voting against these jokers. Client want competition and choice and don’t want to be thrown back into the arms of big business. The MTAA’s -25% loss on a balanced fund just shows how doggy these funds are!!! Big business doesn’t vote. People do!!!!! Labour should have learned this lesson. Liberal took over 10 years before arrogance set in. Labor, one term.
One of the sad characteristics of modern Government is that they are so confined by their idealologies that they are incapable of thinking through a policy position to avoid un-intended consequences.
When I was a public servant that was one of our roles-to remind Government of possible problems in a new policy proposal, but ultimately facilitate the change once the decision was taken. It was called ” frank & fearless advice “, but its been replaced by fear and loathing.
Very sad.
Costello commisioned Wallace, then FSR, and created APRA & ASIC. Then he took his eye off the ball !
The result was a disaster-the lawyers and ASIC ( or are they the same ) got their hands on compliance and scared dealers witless- hence 30 page risk SOAs, and SOAs of biblical proportion for a couple of funds.
APRA could not see what HIH was doing, even though they moved to Sydney
Apparently no one in Treasury saw the potential for self-indulgence by ASIC and the ever increasing cost of compliance. If they did, they were too muted to yell.
Yet direct insurers and television product floggers can sell products on a general advice basis that we would never recommend, with tiny SOAs and a ” no-care ” attitude. A scottish comedian gets on TV, restrains his previous profanities, and flogs a cheap and nasty income protection policy from one of our insurance ” friends ” to un-educated consumers. The particular policy comes with a 2 year benefit period and NO PARTIAL DISABILITY and a 2 year Pre-existing condition rule. The product is so awful its useless, but no one in government thinks its important that the consumers ought to be made aware of the problems.
If enough people attempt to claim on such products, the government will need to re-resource FOS and CentreLink - taxpayers money.
Victims of this rubbish need advice-but it must be paid for - I don’t run a charity !
Oh, and buy the way-this system is the product of the ” small business friendly’ Howard government. All Bowen has done so far is to threaten the traditional method of paying for that advice.
Abbot & Hockey say the client shall make the decision to pay a fee for life risk advice or permit the adviser to be paid commision. I have read the detail, and I must say there is enough ” wriggle room ” in that undertaking to make me be doubtful.
No politican is your friend- they just want your vote on 21 Aug and they will prostitute themselves to get it, and forget all promises, even the ” core ” ones, ASAP - post election
As to the decision on banning life risk commissions, here is my view. The decision has already been made. The industry consultaion is a farce. Treasury are experts at listening intently to stakeholders and the ignoring them, and those well meaning industry headline-seekers trooping to Canberra for a chat are being duped.
And what of our “friends” the life offices. Only one CEO, Jim Minto of Tower, has put in a submission to Bowen stating commissions on life risk should remain.
The rest are, pardon the language, showing a distinct lack of moral fortitude-a failure to proceed.These people would not be managing companies of such wealth if not for the efforts of commission-based agents/advisers who took all the risk over the last 150 years.salaried advisers did not create that wealth.
If common sense prevails, it IS possible to structure a finacial services industry that will be to the benefit of all parties. If self-interest and idealology runs wild,and the person who predicts un-intended consequences is NOT given a hearing, then there is NO HOPE.
Finally, I think our industry should be asking Bowen is his proposed ban on life risk commissions is going to apply to EVERY PARTY who are paid a commission, or just IFA Advisers
For example, Trustees of super funds, including the not for profit funds, are, tecnically, apparently not paid
” commissions”.However insurers who tender to supply insurance products to the Trustees do pay the Trustees for ” services rendered” in getting the member to do the application,then process the application to the insurer, and handle the initial part of any member claim. If thats not transactional commission ( it could never be called “advice” ) then my name is Father Xmas.
AND-dont forget the profit share bonus. In any language, thats ANTI-CONSUMER, because it encourages the Trustees and fund administrators to move claims in to the next bonus calculation period. Sounds like commission to me !
Please Vote for the coalition - not greens as that is a vote for Labor. After working for the Union (Industry) Funds for a couple of years I can only tell you how they hate advisers. Why when they have their own adviser group.l The group is there to roll over funds into industry funds and keep industry funds from leaving when members reach retirment. They hate advisers and the planning group as it is a cost that detracts from their number one business of Funds under management. Really did anyone ever get independant strategic advicde from them. The unions spent a fortune getting Rudd elected. They were so desperate to get rid of him when they saw that they would loose power. Do you think Puppet Julia is concerned about the welfare of the average Joe Australian as opposed to her own and Labor’s power. Wake up Australia. A vote for Julia and her Labor cronies is a vote for union (funds) and the destruction of a very good industry that has been sorely misreprented by those fee collecting do nothing to represent us folks at the FPA. Hey Ms Bloch how is the cushy job at Mercer?
Seriously, the current government have absolutely no idea!!! Rudd & Labor was a dead horse, now Gillard is the one trying to flog the same dead horse-WAKE UP AUSTRALIA!!! No Kevin ‘07 slogun this time, Gillard Gone in ‘10!!!
Ban remuneration/commissions (its the same thing) to Advisers-who are the one who do the REAL work & see the collapse of the welfare system. The Centrelink lines will triple!!! Sickness & Accidents happen every minute of every single day, yet without quality insurance & investment advice to working Australian families by quality Advisers, there is no Plan B, expect more pain on the inept welfard & medical system….
Labor have no idea ! Simple as that !
It is sad that throughout the “debate” that the emphasis has been on “how we are paid” rather than “what we do”. With the ongoing Under -Insurance delema & shortage of adequate retirement funds in Australia , these issues are going to remain or even worsen. I hope the “penny will drop” with the decision makers or do they care ?
Maybe a fresh approach is needed instead of the labor gov’t equal poverty for all approach with my super being their answer to retirement savings. Maybe they should consider reducing the contributions tax from 15% to 10% or 5% . I am sure that would enhance peoples retirement savings. I am sick of hearing about how we are paid . The Government need to understand what we do, the outcomes we achieve for our clients. In the end regardless of who you vote for you will still only end up with a politician.
I have been in this industry for well over 20 years and have been on this earth for over 60 years. I have always had a keen interest in Government and I have never been witness to a Government that is so inept in handling taxpayer’s money, have so little respect for business and industry, any industry and owe so much to the Unions.
We have witnessed the office of Prime Minister be used solely for the purpose of self gratification and public adulation where the office holder had no respect for the office itself only to have it taken from him when the public adulation disintegrated.
We have an Assistant Treasurer rewarded for making a complete mess of Employee Share Plan to the point where even his union mated complained about it.
We have a Treasurer and Deputy Prime Minister rewarded being so stupid as to take up an economic theory that has been around for forty years and NO country has ever applied to its economy for reasons obvious to anyone with the smallest quantity of financial nous.
We have a Prime Minister who swore that she would not challenge for the Prime Ministership then did without much prodding. Who presided over the most wasteful spend of public money in this nations history.
The list is long and not all distinguished. The above comments are only the tip of the Labor iceberg of incompetency.
Why on earth would anyone trust them to restructure this industry.
Unfortunatly, the LP (with the theatrical ideological greens right behind them) are masters at spinning off one liners so that the population beleives that “no advice is good” as they don’t pay. We all know they pay - indirectly. As for fee for service on life products - the LP will add to the underinsurance stats this way as most cannot pay for advice so they will not receive any! Where will the minister for FS be when they can’t make ends meet or pay for medical treatment.
Isn’t it wonderful to imagine a world with no professional employment in the FS sector in future… just faceless dumbed down advice at the end of the phone.
We should all be lining up for a trade certificate as this is the sector that has been bolstered during the GFC due to the union influence over LP to the point where the average Jo can’t get a tradesman to turn up for less than $100… if at all…..
Move over - I’m applying for a new vocation if the LP/Greens get in on 21st August. A “sustainable building licence”
We must not only not vote for labour, but also tell all our clients and family members to vote Liberal. Let us show the Labour Government that though we don’t have money power like the big miners, we have the ability to move people. Let us show them whether we have done a good job helping our clients or we have been reaping them off. This will also show the industry funds their con advertisements of no commissions buy no votes.
Like the majority of my clients, I expect your clients trust you and respect your knowledge and opinions as a professional financial planner. If you want to protect this great industry of ours so that we may continue to provide affordable financial advice to our clients into the future, I urge you tell it to your clients as it is with a view to providing the best chance of a change of Government at the election.
Don’t just tell them about the possible demise of the financial services advice industry - that may appear to be self interest - remind them of the other disasters, failures and outright financial and structural mismanagement of the economy. Don’t forget to mention the political perfidy surrounding the Rudd toppling, the pink batts debacle, the boats and above all else, the fear of the financial services sector virtually being under union control with excessive self interested public service regulatory cost impositions.
Early in the election campaigning, a financial commentator claimed that the financial services sector didn’t cut it as an election issue. That may well be right but it doesn’t mean we can’t influence the outcome. Call it self interest if you like but I have been persuading as many voters as I can that the LP is not only no good for the financial services industry, it is no good for the country. I urge you to do the same.
For me if the Coalition wins the election it will bring huge relief. I like most financial advisers have worked hard and sacrificed income in the early years to build a successful small financial planning practice. When I look at Labour’s proposed Future of Financial Advice legislation I feel depressed and very angry.
There is no doubt in my mind that Labour under instruction from the unions has designed the proposed Future of Financial Advice legislation to decimate financial planning businesses like mine. If Labour is re-elected I think a ban on life insurance commissions is a certainty. I cannot see clients paying a fee for advice on top of a life insurance premium thus my business will not be viable. If I have to walk away from my business due to government interference my clients will be left without advice, my staff will be unemployed and my wife and young children will suffer financially.
Never before in Australia’s history has our freedom and liberty depended so much on the outcome of an election. Many commentators in the press are stating that this election is boring because there is not much difference between Labour and the Coalition. This statement couldn’t be further from the truth. This Labour government is the most left wing government I have ever seen. Wherever there is money, telecommunications, mining, financial services they are trying to bring the majority of each industry under partial or total government (union) control. A vote for the Coalition is a vote for free enterprise, freedom and liberty. A vote for Labour (especially if the Greens hold the balance of power in the senate) is a vote for repression, poverty and communism.
This Government does not understand small Business and realises it cannot control something it does not understand.
Therefore the logical thing to do for a Labour Government/Union controlled demiurge,is to take away or reduce the threat by minimising their oppositions liviehoods, through efficient and simplistic propoganda,focusing on commission and Fee’s.
The 100 million Dollars the Industry Super funds have spent of their members money in advertising,(which could have been given to their members instead) droning on continually about fee’s and commissions charged by their competitors, as the sole reason for clients reduced FUM,seems a bit ironic, but hey it works in the short term and the next obvious masterstroke,will be to ban commissions on Insurance.
Imagine the power the Government(sorry)Unions will wield then.
By eliminating the original financial planners who built the Billions of Dollars of Insurance reserves that has enabled our Industry to grow,
will get rid of another thorn in the side eg;Advisers who can clearly show what a bunch of charlatans,the Industry/Union ideologues are, with their one dimensional thinking.
When you consider that the majority of people are employed in small Business,it would make sense to vote for a party that does not percieve small Business as the enemy.
I wonder if any of our politicians have used the industry funds that they expect the general public to use?? Or are they accustomed to the ‘no brainer’ lifetime pensions which have made them lazy, and sofar removed from reality and the importance that planners play in todays society. I believe if the government want to dumb super down, why told they offer the same super incentives to the general public as what’s being offered to them.
Having been in the Financial services industry for 40 years - and surviving the socialist Whitlan Government that was no picnic - I am appalled that our nation has been subjected to the incompetence, stupidity, lying, uselessness and deceit of the current rabble in Canberra. Julia is a temporary puppet to get the sympathy vote of the unintelligent voters - and heaven forbid - should Labor be returned to power she will be backstabbed and replaced by Bill Shorten and then watch the true socialistic goals of the labor party emerge from their cowardly hiding holes. The Financial Services Industry will be decimated by a returned Labor Government and the general Insurance Brokers are next to be attacked plus many more entrepreuneral professions. Sadly there is not an entrepreunerial person in the whole Labor Party that is why they despise successful people irrespective of their occupations.