The Australian Securities and Investments Commission (ASIC) has released a consultation paper on the implementation of scaled advice, but industry groups are divided on whether it provides enough clarity.
The consultation paper is designed to provide guidance about how to scale financial product advice to retail clients.
In launching the paper, ASIC Chairman Greg Medcraft, said: “Many Australians would like more information and advice before making a decision in relation to a financial product. This will help them to be more confident and informed investors. The proposals outlined in ASIC’s consultation paper aim to improve access to advice and give guidance about how simple, piece-by-piece advice can be provided by anybody in the advice industry.”
However, the Financial Planning Association (FPA) says the paper does not fully deliver on this objective.
“The FPA had provided clear feedback to ASIC on this issue and we strongly recommended that ASIC not release the consultation guidance paper until the Best Interest Duty had been formulated and incorporated as part of this guide,” FPA CEO, Mark Rantall, said.
“In releasing this consultation paper without incorporating the Best Interest Duty, ASIC may actually cause further confusion rather than guidance or clarification for consumers and the profession.”
The Industry Superfund Network (ISN) is more positive about the proposal. David Whitely, ISN Chief Executive, said the industry super funds supported the move to increase the availability of financial advice.
“This is why industry super funds jumped in to fill the gap. Industry super fund members can access affordable advice from a trusted source, confident the advice is not tainted by sales commissions, ongoing advice fees or other inducements.
“People are increasingly expected to make complex financial decisions which they are often ill-equipped to make. When it comes to advice about their super, industry super funds are a trusted and reliable source of advice.
“The financial planners working for industry super funds are fully qualified and many are members of the Financial Planning Association, and CFPs,” said Mr Whitely.
