{"id":58160,"date":"2021-10-19T08:22:55","date_gmt":"2021-10-18T22:22:55","guid":{"rendered":"https:\/\/riskinfo.com.au\/news\/?p=58160"},"modified":"2021-10-19T10:18:20","modified_gmt":"2021-10-19T00:18:20","slug":"industry-bodies-welcome-fscs-blueprint-for-simplified-framework","status":"publish","type":"post","link":"https:\/\/riskinfo.com.au\/news\/2021\/10\/19\/industry-bodies-welcome-fscs-blueprint-for-simplified-framework\/","title":{"rendered":"Industry Groups Welcome FSC\u2019s Blueprint for Advice Framework"},"content":{"rendered":"

Three industry groups have broadly welcomed the release last week of the FSC\u2019s White Paper on Financial Advice.<\/em><\/p>\n

Statements from the AFA, TAA and the FPA indicate the membership organisations’ generally see the FSC’s blueprint for a simplified regulatory framework as helping to build momentum for change (see: Simplify Advice Framework, Drive Down Costs.<\/a>)<\/p>\n

However one licensee group has said while it supports any moves to reduce the cost of advice and relieve the compliance burden as outlined in the FSC White Paper, it says trust is an issue<\/a>.<\/p>\n

\"\"<\/a>
Phil Anderson…the White Paper includes\u00a0 recommendations that should help to reduce the cost and time involved in the production of financial advice…<\/figcaption><\/figure>\n

The AFA\u2019s General Manager, Policy and Professionalism, Phil Anderson<\/strong>, says the White Paper is an important contribution to the ongoing debate about the need to fix the financial advice regulatory regime.<\/p>\n

He says the association also welcomes the KPMG report on the cost of financial advice, \u201c\u2026which highlights the current problem with financial advice being excessively expensive and the importance of finding solutions, including regulatory reforms to reduce this cost.\u201d<\/p>\n

Anderson says the White Paper includes a number of recommendations that should help to reduce the cost and time involved in the production of financial advice.<\/p>\n

\u201cWe particularly welcome the recommendation on the removal of the safe harbour steps, the change of an SoA to a Letter of Advice, and the recommendation that financial advice be tax deductible,\u201d he notes.<\/p>\n

Anderson sees the FSC paper as an important input into Treasury’s 2022 Quality of Advice Review, \u201c\u2026which is a big opportunity to get to the core of the issues and to find solutions to address the problems.\u201d<\/p>\n

He adds that the White Paper is helping to build the momentum for change. \u201cWe look forward to working with all stakeholders to achieve change to make sure that financial advice can remain accessible and affordable…\u201d<\/p>\n

A step in the right direction <\/strong><\/p>\n

\"\"<\/a>
Neil Macdonald…in practice it would mean only licensed financial advisers would be able to give financial advice…<\/figcaption><\/figure>\n

Meanwhile TAA believes the FSC blueprint for a simplified regulatory framework is a positive step in the right direction, and has the potential to deliver better outcomes for consumers and advisers.<\/p>\n

TAA CEO, Neil Macdonald<\/strong> says the association is particularly pleased to see the FSC\u2019s call for the separation of product and advice.<\/p>\n

\u201cThis would represent a giant leap forward, as in practice it would mean only licensed financial advisers would be able to give financial advice.\u201d<\/p>\n

Macdonald adds that TAA is also pleased to see the call to distinguish between financial advice and general information noting that this would help consumers better understand when they are being given financial advice and when they are merely being supplied with general information by a product provider, for example.<\/p>\n

…the regulatory reforms …may have increased consumer protections, but it has come at too high a price for consumers…<\/p><\/blockquote>\n

He states any legal and regulatory change must put the client front and centre and that the\u00a0 regulatory reforms “…that the industry has endured to date may have increased consumer protections, but it has come at too high a price for consumers.<\/p>\n

\u201cThe cost of providing financial advice, the onerous review requirements and the application of black letter law in relation to fee disclosure statements has made the delivery of advice too unwieldy and far too expensive. We can, and we should, do better than this.\u201d<\/p>\n

Macdonald adds that he looks forward to future refinement of the blueprint.<\/p>\n

\u201cThis current version is mainly focused on new clients, and not as much on the ongoing advice and services provided to existing clients …\u201d<\/p>\n

He also notes that the proposed timeline is very long, \u201c\u2026especially with the pent-up demand for advice now, and the inter-generational wealth transfer that will start to accelerate over the next nine years.”<\/p>\n

However, he adds that the blueprint is a sign that “..we are moving in the right direction. While there is certainly more work to do, with genuine collaboration, and a focus on client and consumer outcomes, we are confident that the financial advice industry has a brighter future.\u201d<\/p>\n

Closely aligned<\/strong><\/p>\n

\"\"<\/a>
Dante De Gori…the white paper closely aligns with the FPA\u2019s five-year policy-platform roadmap…<\/figcaption><\/figure>\n

Dante De Gori,<\/strong> CEO of the FPA, says his organisation broadly welcomes the release of the FSC\u2019s white paper and its goal to reduce the cost of providing financial advice, allowing financial planners to spend more time with new and existing clients.<\/p>\n

He says the white paper closely aligns with the FPA\u2019s five-year policy-platform roadmap – Affordable advice, sustainable profession, <\/em>introduced in June 2020.<\/p>\n

He says the FPA policy platform “…has the ultimate aim of reducing red tape and the duplication of regulation in the financial planning profession.”<\/p>\n

He thanked the\u00a0 FSC for engaging with the FPA through its Green Paper process and \u201c\u2026picking up many of the same themes and recommendations that the FPA made 18 months ago.<\/p>\n

\u201cFurther, we commend the FSC on listening to the concerns of the FPA in relation to a number of their proposals which would have added substantial cost and complexity to the delivery of affordable advice to Australian consumers.”<\/p>\n

De Gori says the release of the white paper demonstrates the FSC\u2019s commitment to joining with the FPA in the discussion of how to put advice delivery back in the hands of professional financial planners and in the reach of all Australian consumers.<\/p>\n

…The profession will now benefit from a stronger and unified representative voice…<\/p><\/blockquote>\n

\u201cThe financial planning profession will now benefit from a stronger and unified representative voice on the issues most critical to them.\u201d<\/p>\n

The statement adds that with the Government\u2019s intention to introduce a single set of standards for the financial planning profession, \u201c\u2026we believe now is also the time to prioritise the establishment of a principles-based professional and ethical advice model, as opposed to the current \u2018tick-a-box\u2019 rules based approach to compliance under the existing regulatory framework.\u201d<\/p>\n

De Gori says that with these measures in place, \u201c\u2026the next crucial step to get right, and ensure the success of the proposed single disciplinary model and a principles-based professional advice model, is to create a true professional registration model, which is a key recommendation from the FPA\u2019s Policy Platform.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"

Three industry groups have broadly welcomed the release last week of the FSC\u2019s White Paper on Financial Advice. Statements from the AFA, TAA and the FPA indicate the membership organisations’ generally see the FSC’s blueprint for a simplified regulatory framework as helping to build momentum for change (see: Simplify Advice Framework, Drive Down Costs.) However […]<\/p>\n","protected":false},"author":24,"featured_media":58169,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[282,8],"tags":[],"class_list":["post-58160","post","type-post","status-publish","format-standard","has-post-thumbnail","category-associations","category-compliance-regulation"],"_links":{"self":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/58160","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/users\/24"}],"replies":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/comments?post=58160"}],"version-history":[{"count":0,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/58160\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/media\/58169"}],"wp:attachment":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/media?parent=58160"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/categories?post=58160"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/tags?post=58160"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}