Advisers need certainty on aged care advice status

The Government’s new Aged Care Bill must be more explicit about the role of financial advisers acting on behalf of older clients in relation to their aged care needs, according to the major accounting groups.

A Parliamentary Committee reviewing the Aged Care Bill 2024 has been told by the accounting groups that the role of financial advisers is currently unclear in the legislation because it does not align with the Corporations Act descriptor of advisers as ‘relevant providers”.

Chartered Accountants ANZ, CPA Australia and the Institute of Public Accountants said financial advisers have obligations under the Financial Planners and Advisers Adviser Code of Ethics for the potential future aged care needs of clients to be considered.

“This may include acting as the client’s representative in relation to aged care matters and interactions with aged care providers. However, it is unclear how the function of financial advisers, defined under the Corporations Act as ‘relevant providers’, fits into the role of ‘advocate’, ‘representative’ or ‘supporter’ as described in the Bill,” the accounting groups said.

They said the law needed to be clarify how the definitions interact and the intended role of the person acting under the definitions and be applied to the assistance financial advisers and other provide clients in relation to their aged care needs.

“Given the provision of financial advice is heavily regulated under the Corporations Act 2001 and the Code, with oversight by ASIC, we recommend clarification to ensure that ‘relevant providers’ operating under the Corporations Act are not inadvertently captured under the definitions or provisions in the Bill,” the submission said.

“We also recommend clarification that public practising members of Australian-based professional accounting bodies are also not intended to be captured under these definitions and provisions of the Bill. These points of clarification could be included in the Bill’s Explanatory Memorandum.”

“We do not support any requirement that would require those providing aged care funding assistance or advice to hold, or be an authorised representative of, an Australian Financial Service License. Feedback from members indicates confusion in the market on this point, which in some cases has added to the cost of seeking advice from a range of professional advisers.”