Research company Rice Warner has issued a statement clarifying its estimate of the cost of opt-in.
As part of the release of the first tranche of the Future of Financial Advice (FoFA) legislation, Financial Services Minister, Bill Shorten, cited Rice Warner research that estimated the cost of opt-in would be $11 per client. The press release that accompanied the draft legislation stated the $11 cost… ‘includes the set-up costs and the cost of chasing up clients who are charged on-going fees but who advisers may not be in regular contact with.’
The $11 per client per annum cost estimate is an ongoing cost, and excludes implementation expenses
However, Rice Warner has explained that the $11 per client per annum cost estimate is an ongoing cost, and excludes implementation expenses.
The group also reiterated that it had made an important underlying assumption that advisers are already in regular contact with their clients, meeting at least once a year.
According to Rice Warner, ‘the cost of ‘opt-in’ should not be confused with the cost of contacting clients who are not serviced regularly and the implementation and ongoing costs of other FOFA reforms.’
