The Government passed legislation through the House of Representatives last week to end the payment of grandfathered conflicted remuneration to financial advisers.
An update from the Treasurer stated: “Grandfathered conflicted remuneration can entrench clients in older products even when newer, better and more affordable products are available on the market. Ending the payment of grandfathered conflicted remuneration will remove this inherent conflict and restore trust in the financial advice industry.”
Ending the payment of grandfathered conflicted remuneration to advisers was one of the key recommendations of the Royal Commission and is now on its way to becoming law.
Under the Bill, conflicted investment and superannuation remuneration paid to financial advisers will be banned from 1 January 2021.