Govt releases QAR 1st tranche legislative draft
As flagged by the minister’s office, the Government has released the exposure draft of the first tranche of its legislation resulting from the Quality of Advice Review (QAR).
The legislative draft envisages the following:
- Amending the Superannuation Industry Supervision Act to allow supeannuation funds to charge individual members for financial advice form their superannuation account.
- Streamlining ongoing fee renewal and consent requirements and removing the requirement to provide fee disclosure.
- Creating more flexibility around Financial Services Guides including making FSGs available on websites.
- Clarifying conflicted remuneration in the following terms.
- clarifying that monetary or non-monetary benefits given by a client are not conflicted remuneration along with the removal of consequential exceptions;
- introducing a specific exception to the conflicted remuneration provisions that permits a superannuation fund trustee to pay a fee for personal advice where the member requests the trustee to pay the fee from their superannuation interest;
- removing the conflicted remuneration exception for the issue of financial products or advice where advice about the product has not been provided in the previous 12 months; ‒
- removing the exception to conflicted remuneration rules for agents or employees of Australian ADIs; and
- standardising consent requirements for life risk insurance, general insurance and consumer credit insurance commissions in the Corporations Act
The Federal Opposition has already stated the changes do not go far enough quickly enough.
The real changes where’re after, SOA, BID safe harbors etc., kicked down the road! Honestly, we are treated like mugs again and again.
I think it’s indicative that they understand the scope of the problem now. It’s one thing to tell everyone that super funds will be giving intra fund advice on anything they want. It’s entirely another issue to actually come up with a plan to make it happen that doesn’t lead to untrained call centre jockeys slinging inappropriate advice to members.
I believe they massively underestimated the complexity and challenges of what financial advice actually is and the value it can provide (as all ministers seem to have done in the past).
I also believe they assumed that the super funds could click their fingers if the appropriate rules changed and suddenly be able to cater for, and give advice to, hundreds of thousands of Australians.
The reality is that no super fund that I’m aware of has demonstrated an ability to run an efficient, high quality advice business. They’re inevitably loss making, subsidized by other members and rely on FUM retention to justify their existence.
I really hope Mr Jones has come to understand that the solution is reducing red tape to professional advisers, not allowing untrained sales people offer advice but in reality, this seems to be the option they’ve backed themselves into.
Jones is a poor excuse for an MP. His stated desire for “quick wins” was nothing but a lie.
I think the problem is that he and his colleagues had no idea of the issues facing the industry and the complexity in solving them. Yet another example of a Government that, after a decade in opposition came to power with no concrete plans, just soundbites.
He’s a Labor MP….what else was anyone expecting but that?
Blind Freddy can see that for whatever reason, Labor aren’t interested in improving our economy, our standard of living, reducing the cost of energy or easing immigration to offset the cost of living crisis. Everything they do aims at the exact opposite. Division through the thankfully failed Voice to Parliament Referendum (after blowing $450 MILLION) and now this Pure Communist ‘Misinformation / Disinformation’ Bill they’re trying to push through to prevent dissent against their madness are all evidence of this toxic Labor Government’s intent to destroy this country.
No surprises here for me personally…
this is the equivalent of addressing climate change by Mr Jones switching off the air conditioner in his office for the rest of the day
At the same time making it easier for fossil fuels to be sold, i.e. Industry Funds flogging product via call centre jockeys.
When is the next election again?
“Red tape at the federal level has increased by 88 per cent since 2005, and is now at a record high”.
Please see article link
Red Tape At Record High Across Australia (ipa.org.au)
Ok time for the next election, demand change or get voted out.
Noticed these interesting paragraphs in the draft legislation, which raise doubts about the Government’s promise of a single consent form:
Section 1.79
However, while product issuers would be entitled to rely on the prescribed form, the law would not require a product issuer to accept the form
Section 1.83
…the form would not be required or mandatory so as not to restrict product issuers who want to apply different rules or practices (in addition to the legislative requirements) to the payment of ongoing fees
Good pick up.
Yep. This looks designed to leave it open for union super funds to continue their adviser blocking shenanigans. Most advisers would be happy to recommend union super funds to their clients if the union funds were supportive and cooperative. But when they are deliberately obstructionist (as most are) that is a perfectly valid reason to avoid them. The value added from advice strategies will generally far exceed any small differences (if any) in fund fees or performance.