{"id":75331,"date":"2025-01-16T14:33:28","date_gmt":"2025-01-16T03:33:28","guid":{"rendered":"https:\/\/riskinfo.com.au\/news\/?p=75331"},"modified":"2025-01-24T09:31:57","modified_gmt":"2025-01-23T22:31:57","slug":"impact-analysis-of-cslr-likely-not-undertaken","status":"publish","type":"post","link":"https:\/\/riskinfo.com.au\/news\/2025\/01\/16\/impact-analysis-of-cslr-likely-not-undertaken\/","title":{"rendered":"Impact Analysis of CSLR ‘Likely Not Undertaken’"},"content":{"rendered":"

The impact of the Compensation Scheme of Last Resort (CSLR) on financial advisers may not have been carried out by Treasury. The claim is made by the FAAA which has been pushing for a range of government documents related to the scheme to be released.<\/p>\n

The industry body made a request under the Freedom of Information act last year. But rather than respond within the statutory 30 days, the FAAA says government took four months to release a bundle of redacted documents<\/a>.<\/p>\n

Having read them, FAAA CEO Sarah Abood<\/strong>, says a review of the files reveals an impact analysis into the CSLR was “likely not undertaken” before it was introduced.<\/p>\n

There appears to have been no timely analysis done on the costs and benefits of the CSLR…<\/p><\/blockquote>\n

\u201cThe apparent lack of any impact analysis being conducted during the scheme’s development has led to substantial financial strains on the profession which should have been foreseen, and could potentially have been avoided if a proper impact analysis had been undertaken,\u201d says Abood.<\/p>\n

\"Sarah<\/a>
Sarah Abood.<\/figcaption><\/figure>\n

\u201cThere appears to have been no timely analysis done on the costs and benefits of the CSLR.\u201d<\/p>\n

Abood says statements were made that the Hayne Royal Commission<\/a> \u2013 which culminated in a 2019 report on misconduct in banking, superannuation and financial services \u2013 was the equivalent of an impact analysis.<\/p>\n

\u201cThe Royal Commission had a different purpose and was finalised over four years beforehand \u2013 well before the extent of the failings at Dixon Advisory<\/a> were known, and well before the legislation for the CSLR was considered by parliament [in 2023].\u201d<\/p>\n

Dixon Advisory collapsed in 2022 and its clients have lodged claims for compensation under the CSLR scheme. It could cost the advice profession more than $135m, and among those on the hook for reparation are independent financial advisers. See: \u2018Deep Concerns\u2019 on Cost to Advisers<\/a>.<\/p>\n

We are calling for the government to acknowledge the scale of the exposure the financial advice profession faces…<\/p><\/blockquote>\n

Abood says there appears to have been no attempt to calculate the likely costs of CSLR to advisers, or assess whether these costs are affordable or sustainable.<\/p>\n

\"\"<\/a>
Stephen Jones.<\/figcaption><\/figure>\n

Last year the FAAA met with Minister Stephen Jones<\/strong> and Treasury to continue work on fixing the unintended consequences of the CSLR, and played a key role in securing a public inquiry into the failings of the scheme.<\/p>\n

\u201cWe are calling for the government to acknowledge the scale of the exposure the financial advice profession faces, and to undertake an urgently needed review of the CSLR legislation, to ensure the CSLR is fairly and sustainably funded,\u201d says Abood.<\/p>\n

The FAAA has continued to investigate the circumstances surrounding the Dixon Advisory collapse and the way the CSLR was established.<\/p>\n

“If the government is serious about ensuring the fairness and sustainability of the CSLR, it must act now to rectify the many flaws that have emerged since the scheme was established,\u201d says Abood.<\/p>\n","protected":false},"excerpt":{"rendered":"

The impact of the Compensation Scheme of Last Resort (CSLR) on financial advisers may not have been carried out by Treasury. The claim is made by the FAAA which has been pushing for a range of government documents related to the scheme to be released. The industry body made a request under the Freedom of […]<\/p>\n","protected":false},"author":23,"featured_media":75339,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[282,48,8,3,8282],"tags":[],"class_list":{"0":"post-75331","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-associations","8":"category-company-news","9":"category-compliance-regulation","10":"category-general","11":"category-government"},"_links":{"self":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/75331","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\/23"}],"replies":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/comments?post=75331"}],"version-history":[{"count":0,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/75331\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/media\/75339"}],"wp:attachment":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/media?parent=75331"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/categories?post=75331"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/tags?post=75331"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}