The majority of consumers are in favour of “opt-in”, according to a survey commissioned by the Industry Super Network (ISN).
The survey, conducted by Newspoll during February, found that nearly 75% of respondents were in favour of the annual renewal of ongoing fees. In addition, of those who had used a financial adviser, 85% said that they preferred to pay for the advice via a set fee or hourly rate, as opposed to ongoing deductions from their investments or superannuation.
“Consumers clearly expect full transparency on fees, and are supportive of the government’s agenda,” said ISN CEO David Whitely.
The survey also found almost 9 in 10 respondents (89%) believed there should be a law requiring financial planners to act in the best interests of their clients.
“The financial planning industry has gone through countless scandals, such as Storm and Westpoint and is clearly suffering a crisis of public confidence,” Mr Whiteley said.
the industry continues to oppose the government’s reforms… designed to prohibit conflict of interest based remuneration
“Despite this, the industry continues to oppose the government’s reforms which are designed to prohibit conflict of interest based remuneration such as commissions and volume rebates and provides for an annual renewal of services.
“If financial planners aspire to be professionals, then they must charge like other professionals do – by an hourly or set fee paid by the client rather than volume based payments from product providers, and to get annual permission from clients to continue deducting ongoing fees from client’s investments,” added Mr Whitely.
