The Government has introduced the Bill into Parliament which delivers the first tranche of its Delivering Better Financial Outcomes package, including the initial response to the Quality of Advice Review.
The Explanatory Memorandum for the Treasury Laws Amendment (Delivering Better Financial Outcomes and Other Measures) Bill 2024 says that Tranche 1 includes “…amendments that will provide legal certainty for the payment of financial adviser fees from a member’s superannuation fund account and remove red tape that currently adds to the cost of financial advice with no benefit to consumers.”
It adds that this measure will “…support increased access to affordable financial advice for millions of Australians and will particularly benefit the five million Australians at, or approaching and planning for, their retirement that need assistance navigating the pension and superannuation systems.”
On 14 November 2023, Treasury had released draft legislation to implement half of the Quality of Advice recommendations as part of this tranche of Delivering Better Financial Outcomes package (see: Risk Commissions Enshrined).
The FSC Response
In noting the Government’s introduction of tranche one of its reform package on financial advice into Parliament, the FSC says the financial services industry “…shares the Government’s objective of making financial advice more affordable and accessible for Australian consumers.”
However, the council says, this requires “…an ongoing commitment to take every opportunity to remove unnecessary red tape and duplication on financial advisers and their clients.”
…this first round of measures introduced to Parliament will implement positive changes supported by the industry…
It says this first round of measures introduced to Parliament will implement positive changes supported by the industry “…including streamlining fee consent requirements, enabling greater flexibility around the provision of Financial Services Guides and tightening the ban on conflicted remuneration.”
The FSC says it’s concerned the current drafting of the Government’s Bill, however “…risks missing the opportunity to remove costly regulatory duplication that currently requires both financial advisers and superannuation trustees to approve advice fee deductions from superannuation accounts.”
CEO of the FSC Blake Briggs says industry encourages the Assistant Treasurer “…to make the most of the opportunity to remove onerous duplication and red tape that has contributed to advice becoming unaffordable for millions of Australian consumers.”
He says the council supports the Government’s aim of ensuring more Australians can access financial advice through their superannuation “…but despite the many positives in the Bill we are concerned that it will entrench unnecessary obligations on superannuation trustees that would be costly to maintain and act against the delivery of affordable financial advice.”
“The FSC encourages the Government to continue to consult through parliamentary processes to address industry’s concerns and to ensure financial advice is more affordable for Australian consumers.”
