CALI’s CEO Christine Cupitt is set to meet with Financial Services Minister Daniel Mulino at a round table discussion later this week at which she will argue for fairer treatment of financial advisers – particularly risk advisers – when it comes to shouldering the cost burden of the Compensation Scheme of Last Resort.
At the round table, which will also be attended by consumer groups and other industry stakeholders, Cupitt will be calling on the Federal Government to help fund the CSLR shortfall and to reduce the financial pressure on advisers.
Advisers are currently facing a potential $4,000 special CSLR levy due in part to failures linked to the Shield and First Guardian Master Funds and consumer claims for their losses.
Treasury confirmed last year that a $47.3m special levy will apply in the 2025-26 financial year to meet higher-than-expected CSLR claims, with advisers set to pay more than 20% of it.
Cupitt said life insurers support spreading the CSLR levy across the broader financial services sector, and the Government should also share part of the cost.
Risk advisers aren’t a threat to Australians’ savings
“Risk advisers aren’t a threat to Australians’ savings, instead they help them access peace of mind and financial security when they need it most,” said Cupitt, adding:
“The scheme is very important for victims of financial misconduct, and the Government needs to take a fairer approach and make sensible changes to the design of the scheme to ensure it remains sustainable in the long run.”
Cupitt said the Government’s promised Delivering Better Financial Outcomes reforms would play a significant role in responding to financial misconduct.
“We have seen firsthand what happens when people don’t have access to professional financial advice,” she said. “They are left with no one to talk to and, in the worst of cases, with no financial safety net to lean on when they need it most.”
See our report: CSLR Levy Fuels Adviser Exit Fears
