The financial advice profession could be on the hook to pay Compensation Scheme of Last Resort (CSLR) fees totalling $123m in the 2026/27 year according to the FAAA. This follows news of a potential $70m CSLR levy for the 2025/26 year.
The figures feature in a just-published report by Phil Anderson, the FAAA’s GM Policy, Advocacy and Standards, that includes the ongoing impact of Dixon Advisory and property firm United Global Capital (UGC) failures on the financial advice sector.
All-up, the sector is staring down the barrel of CSLR levies totalling $212m for the 2024-2027 financial years, according to the report.
Anderson says the cost of AFCA to process each Dixon Advisory claim could rise from an estimated $12,450 to $21,334 in the 2025/26 year.
He also states the 2025/26 initial estimate for the financial advice sector in relation to UGC is $44.6m in claims and $3.6m in AFCA fees.
Anderson says: “On the basis of our analysis, and particularly looking at the cost of the Dixon Advisory debacle, the cost for the financial advice profession in 2026/27 looks likely to be around $123m.
“Across the next two financial years, the cost of the CSLR levy to the financial advice profession could be $193m. This is around $12,500 per adviser.
I wonder if the architects of this outcome feel pleased with what they achieved…
“If this is not enough to force the Government to take quick action, then it is difficult to see what else it would take.”
See our report: CSLR Inquiry Delayed
Anderson says that as an absolute minimum, the financial advice profession should not be paying any more than the $20m sector cap in any one year.
Anderson concludes his report saying: “I wonder if the architects of this outcome feel pleased with what they achieved, or embarrassed. One can only hope that they have a conscience.”
Click here for our previous reports on CSLR, and click here for more on Dixon Advisory.
