Advisers have delivered a resounding vote of no confidence in the Government’s Future of Financial Advice (FoFA) reforms when it comes to the goal of more consumers receiving more advice.
A huge 92% of advisers in our latest poll have said they do not believe that more financial advice will be delivered to more Australians as a result of the introduction of the FoFA reforms. This outcome represents a significant thumbs down for what is one of the fundamental reasons for the introduction of the FoFA reforms.
Based on the comments we have received, there exists a large proportion of the adviser community who believe that the agenda for FoFA has been driven mostly by industry superannuation funds and by a Government seeking to gain voter kudos for implementing what are seen to be consumer-friendly reform measures. They believe that the intended reforms will have the opposite to their intended effect by creating an environment in which quality advice becomes more difficult to deliver:
“The whole effect of FOFA is to create another Compliance industry“
… is how one adviser summed up his views. Another commented that the FoFA reform process has caused stress and uncertainty for advisers across the board, instead of focusing on the small proportion of advisers who delivered inappropriate advice that led to the collapse of a number of advice firms, contributing in part to the FoFA reform process itself:
“They should have hit the advisers who created this mess – not penalised the whole workforce of other honest advisers for political gain…”
Another adviser acknowledged the intention of FoFA, but not its execution:
“It may assist the industry to be more responsible and generally add some reforms which, of course, benefits clients and prospective ones.
“Like many things though, it could have been handled better. It wasn’t thought through anywhere near enough at the outset. Ultimately it’s likely to finish up having cost plenty but achieving little.”
A year ago, a similar riskinfo poll question received a similar result, when 94% said they believed the FoFA reforms would not lead to a higher proportion of consumers seeking advice from financial planners. This latest result appears to indicate that views, one year on, have not changed.
Does this one-sided result reflect your position? Does your own view mirror what appears to be the views of the vast majority of Australian financial advisers? We are keen for you to add your vote and to have your say…
