Industry associations are calling on the Government to move swiftly to fix legislation introduced into Parliament “…so that it doesn’t make advice more unaffordable and less accessible for consumers.”
The Joint Associations Working Group says that under the Government’s proposed Treasury Laws Amendment (Delivering Better Financial Outcomes and Other Measures) Bill 2024 “…consumers will face more red tape when it comes to setting up an ongoing adviser arrangement with superannuation trustees to pay for advice, with no additional consumer protections.”
It says that under the proposed legislation, superannuation trustees that allow fee deductions “…will need to check every piece of advice individually and duplicate valid checks already undertaken by financial advisers and their licensees.” (Also see: Legislation Welcomed, But One Key Concern).
The working group says that professional advisers, superannuation trustees and advice licensees have consistently provided the Government with suggestions to reduce red tape, make it easier for consumers to access affordable advice, and remove duplication in the adviser fee deduction processes for consumers, advisers, licensees, superannuation funds and their trustees.
“JAWG understands this is a technical area that is hard to get right and is ready to work with the Government to get the best outcome for consumers.”
…the Government needs to make urgent changes to the legislation…
It says the Government “…needs to make urgent changes to the legislation to make advice more accessible and affordable to consumers to provide a way forward that is not unworkable and worse for all than the current situation at law.”
The group says advisers already have a Best Interests Duty and they must ensure their fees are reasonable and apportion the fees appropriately to meet the SIS Act requirements.
…Codifying the requirement for trustees to also substantiate the claim of deductibility will increase red tape as multiple interpretations will be put in place…
“Codifying the requirement for trustees to also substantiate the claim of deductibility will increase red tape as multiple interpretations will be put in place, requiring advisers to respond to numerous different processes, which adds to the cost of advice and results in a poor consumer experience.”
The statement also notes that JAWG supports the Government in its efforts to reform financial advice and welcomes a number of red tape reduction measures progressed by the Government as part of the Delivering Better Financial Outcomes package.
The Joint Associations Working Group is a coalition of 12 industry and professional bodies. It’s members include:
- Boutique Financial Planning Principals Association Inc.
- CFA Societies Australia
- Chartered Accountants Australia and New Zealand
- CPA Australia
- Financial Advice Association of Australia
- Financial Services Council
- Financial Services Institute of Australasia
- Institute of Public Accountants
- Licensee Leadership Forum
- Self Managed Super Fund Association
- Stockbrokers and Investment Advisers Association
- The Advisers Association Ltd
