The Investment and Financial Services Association (IFSA) \u00a0has today announced a landmark Superannuation Charter in its bid to\u00a0 ‘… create a fairer and more competitive superannuation system for all Australians’,\u00a0which includes a ‘new approach’ to\u00a0payment for financial advice.\u00a0<\/p>\n
The Association’s\u00a0Draft Superannuation Charter: A New Commitment to Super Members<\/em>, contains four key policy areas:<\/p>\n On the issue of payment for financial advice in superannuation, outgoing IFSA CEO, Richard Gilbert<\/strong>, said that commencing from July 2010, IFSA is planning a fresh approach:<\/p>\n “Under the new regime consumers will be empowered by knowing exactly how much they are paying for financial advice in their superannuation. Fund members will be able to negotiate the value they receive for the advice fees they pay – and to opt-in or opt-out of advice payments depending on their circumstances and needs,” said Mr Gilbert.<\/p>\n In addressing the four\u00a0policy areas, Mr Gilbert said “While some recommendations are for government and regulators to address, one very important set of reforms is for the industry to deliver.\u00a0 And deliver we will.”<\/p>\n Under the draft charter, IFSA proposes two forms of remuneration structures in its ‘payments to advisers policy’:<\/p>\n 1. Member Advice Fee<\/span><\/p>\n Taken from the draft charter document, the member advice fee is outlined as follows:<\/p>\n When an individual receives personal financial advice from a financial adviser in respect of a superannuation account, they will be asked to agree the amount they will pay and how the payment will be made. It also allows super members to turn the payment off if they cease the relationship with their adviser.<\/em><\/p>\n The introduction of this policy means that no fees will be paid by super members to financial advisers in respect of personal financial advice, unless the service is received and the payment agreed by the member.<\/em><\/p>\n \u00a02. Plan Service Fee<\/span><\/p>\n The Plan Service Fee relates to corporate superannuation plans established by a financial adviser:<\/p>\n When a corporate plan is established by a financial adviser, ongoing support and administration services are often provided by that adviser to the corporate plan members. The PSF is applicable only where those adviser services are paid from corporate plan member super accounts.<\/em><\/p>\n Under IFSA’s Super Charter, the annual statements provided to plan members will include the value of the PSF being paid to a financial adviser. After an initial period of time, members that wish to will be able to opt out of receiving the additional adviser services and therefore from paying the PSF.<\/em><\/p>\n \u00a0The policies proposed by IFSA are intended to be open for discussion until Monday 14 September 2009, with the IFSA Board looking to formally adopt the Super Charter at its Board meeting on Wednesday 28 October 2009.<\/p>\n Once adopted, these policies will see a transition period from 1 July 2010, with full implementation expected to be completed by 1 July 2012.<\/p>\n\n
Fund members will be able to negotiate the value they receive for the advice fees they pay – and to opt-in or opt-out of advice payments…<\/h6>\n