Jones joins the legion of the ministerial unlamented
EDITORIAL
It has been the misfortune of the financial planning profession over the past 20 years that it has rarely been blessed by having a federal portfolio minister who left advisers feeling their profession was understood.
The same might be said of outgoing Assistant Treasurer and Minister for Financial Services, Stephen Jones, who came in promising to fix what he called a “hot mess” and will now leave Parliament at the upcoming Federal Election having not so much fixed the hot mess as having cooled it down a little. But only a little.
Over the years, I have conducted a number of surveys of financial advisers asking them to rate the performance of financial services ministers and, almost inevitably, those advisers have been scathing in their assessments and particularly scathing with respect to former Coalition Government minister, Kelly O’Dwyer.
The initial feedback from Financial Newswire readers suggests that few will be shedding tears about Jones’ decision to exit the Parliament.
But what should be understood about Jones is that he is a junior minister in the Treasury portfolio and, notwithstanding the economic importance of superannuation and financial services, remained in the outer Cabinet. What is more, he lacked the ALP factional clout of one of portfolio predecessors, Bill Shorten.
The ‘hot mess’ that Jones referred to in the run-up to the last Federal Election was the situation around the Quality of Advice Review (QAR), the fall-out from the dysfunctional Financial Adviser Standards and Ethics Authority (FASEA) regime and the roll-on impacts of the Royal Commission.
What progress did Jones make? Well, the distillation of the of the QAR recommendations into the first round of the Delivering Better Financial Outcomes (DBFO) represents a small achievement in what represents a complex and unfinished tapestry.
What did Jones get wrong? Most obviously the manner in which the Compensation Scheme of Last Resort (CSLR) was established and the Government’s failure to acknowledge bureaucratic and regulatory responsibility for the ballooning costs associated with the collapse of Dixon Advisory.
Jones also stuffed up significantly when he floated the “qualified adviser” descriptor for the proposed new tier of advisers many of whom would be working for superannuation funds and who would be, patently, not as qualified as those on the Financial Adviser Register (FAR).
Financial planning and other industry groups apparently found Jones and his office reasonably approachable but the lack of progress in driving forward on financial planning policy suggests that the real decision-making was occurring amongst those surrounding the Treasurer, Jim Chalmers and in the Department of Treasury itself.
It says something about Jones’ tenure in the portfolio and his approach that both the Financial Services Council (FSC) and the Association of Superannuation Funds of Australia (ASFA) wished him well, with ASFA listing his achievement as being:
- Increasing the super guarantee to 12%
- Providing superannuation on top of government-provided paid parental leave
- Progress towards Payday Super
- Progress on ensuring the provision more affordable and accessible financial advice
- Enshrining the objective of superannuation into legislation
Progress, sure, but the outcomes await another day and another minister.
Mike, you have highlighted an interesting point about real decision making being made by the unelected bureaucrats in Treasury rather than the responsible Minister. It has become increasingly clear that Treasury bureaucrats are detached from the real world, do not care about the needs of consumers, and have an extreme bias against financial advisers.
There must be a draining of the Canberra swamp.
HIs crowning achievement is his plan to enshrine vertical integration by giving conflicted sales people the ability to ignore the education, training and compliance rules real advisers need to abide by. “Enshrining the objective of super into legislation” is just another feel good, abject waste of time from this Government and minister who have shown they are completely incapable of handling difficult reform.
Much of what we deal with is a result of the past LNP Gov but we can only hope whoever is in power after the next election is up to the task of meaningful reform that cuts pointless red tape while still leaving appropriate consumer protections in place….I won’t hold my breath.