Jones reinforces non-conflicted super advice delivery
The Government has reinforced its view that superannuation funds will be a major conduit for the delivery of more affordable advice, with Assistant Treasurer and Minister for Financial Service, Stephen Jones taking to radio to drive home the point.
Speaking in Brisbane, Jones said he had been working out how more advisers could be brought into the industry and how more information and advice could be delivered.
“So I’m looking at superannuation funds as a likely candidate,” he said.
“How can people who often ring their funds and say, ‘’m planning for retirement, have I got enough super? What should I be doing? How does it interact with the pension? What about my wife?’” Jones said. “And the funds because of the laws we’ve got at the moment say, ‘Sorry, we can’t answer those questions. You’ll have to go to an adviser’, and the adviser will say to them, ‘Sorry, my books are full. I can’t help with you that information’.”
Jones also acknowledged that the financial advice profession had become over-regulated with the result that consumers were being inhibited from obtaining good advice “because there’s just not enough people and not enough avenues to get advice”.
“And that’s what my job is to fix,” he said.
“So, I’ve got three jobs of work going on at the moment. The first is about red tape reduction, removing all the obstacles that don’t provide any consumer protection but do make it harder for a licensed financial provider to provide information and advice to consumers. Hopefully, that will enable advisers to bring more customers in but also reduce the prices.
“A second job of work is looking at how can we safely provide an environment where superannuation funds can provide information to their members. They stopped doing it in large part because of the reforms put in place over the last decade.”
“We do have to ensure that we’re managing for conflicts of interest. So, don’t want to see a situation where someone is getting a commission for providing advice to somebody to buy a product from a superannuation fund that they work for. So, we’ve got to work through all of those conflicts to ensure that information and advice are being given by a fund that’s absolutely in the interests of the person who’s receiving it. And that’s what I’m dealing with the profession and with superannuation funds and with regulators and consumer groups through at the moment.”
“But my objective: ensuring that people can make good decisions because they have good information and they’re not going to, I don’t know, Instagram influencers who have no license, have no knowledge, have no qualifications, and are providing broad and sometimes dangerous information to people.”
Stephen Jones let’s the cat out of the bag with this – “What about my wife”.
He’s about to gift super funds with the ability to provide advice in all areas. No doubt the super funds won’t even need to pay the ASIC levy either. Obviously this advice is going to be conflicted because they’ll only be recommending their own product. Instead of the Big Banks , it’s not going to be Big Super.
No doubt there is going to be a lot of conjecture about what ‘simple advice’ means.
I have no confidence that this will be resolved appropriately.
I expect that super funds will be given considerable leeway – spouse, Centerlink etc. (in the name of access and affordability)
Real advisers may continue to be held on a very short leash (in the name of consumer protection).
I’ll give him credit on the reducing red tape comment, but when is it happening???? We are not giving advice right now to some people that you claim to care so much about and you have been in power now for more than 12 months.
“We do have to ensure that we’re managing for conflicts of interest”.
A commission is NOT the only conflicted form of REM. There are bonuses, promotions, other incentives and keeping your job….or losing it. There has already been attestations from advisers who USED to work in industry funds that have stated that had two forms of advice were permitted and were pressured heavily to provide it. Before tax contributions and after tax contributions.
If anyone can organise a racket, its a union boss.
Precisely Mr Jones, how are you going to “ensure that we are managing conflicts of interest” in these circumstances even IF you do repeal standard 3????
Very disingenuous for Jones to say advisers books are full. Most advisers could take on plenty more clients if they weren’t overburdened with the time and cost impacts of bad regulation. Jones talks about fixing bad regulation, but we have seen no tangible improvements yet.
Seems like he wants to keep bad regulation in place to maintain an artificial shortage of professional advice, and create an excuse for conflicted union super sales reps to “fill the advice gap”.
100% agree, zero reduction in BS Regs and Red Tape costs for Real Advisers. Talk and talk and zero walk the walk hey Jonesy.
Instead the focus to give Industry Super Fund call centre jockeys access to Full Advice, by uneducated, unqualified, unlicensed and unregulated back packers flogging only ISA vertically owned products. And all paid for by HIDDEN COMMISSIONS charged to All members when 90% are paying these hidden commissions for NO Service.
Sounds like another RC ain’t to far off Jonesy.
So much for fixing the Real Adviser BS mass over compliance Hot Mess.
Jones…out of touch, incompetent, liar, CSLR, 300% increase in ASIC Levy, over regulated and nothing being done about it despite promises. Reminds me of Hume!
These are all the reasons why this fully qualified adviser of 35 years has thrown in the towel, and is looking forward to an early retirement.
Can someone please tell Jones that commissions for financial planner of investment product sales have been banned (by the Labor party no less!) since 2014…….. including insurance within superannuation!!
Next legislative train wreck incoming in slow motion very soon.
What a Joke! Of course, its conflicted advice as the wage of the Employee is paid by the profits of the superannuation fund. If the Employee doesn’t sell the product that pays his wage how long will the Employer/Super fund Employ him/her? Yje Employer can only recommend that super fund so how is that clarified as good or beneficial advice to the client.
This is how we got in this mess with the banks and Industry super funds in the first place.
It is just so infuriating watching how this government is slowly going to ruin another industry and line the pockets of their Labor mates.
He will be a director on an Industry super fund in the future if he gets this through mark my words.
Just ridiculous
My asset i.e. may trail commission was taken off me. i.e. my wage from a product provider. Now people (unqualified) are going to get paid wages to supply conflicted advice from product providers they work for (Industry Funds). The hypocrisy of the left is so obvious. Why is there no class action by advisers to seek compensation for the loss of our assets? FPA AFA FAAA AIIOPFP all laughable.
I’m sorry but you had many years to transition those clients from Commission to Fee For Service and in most cases it would have been a win for the clients and a no brainer. You were either too apathetic or did not have a good relationship with your clients
Yeh I agree with this comment, you didnt lose anything, you failed to act for your clients interests.
We are all out here getting paid, providing service.
Consumers have been let down by this incompetent imbecile and his communist cohort in Canberra.
The industry (union) funds benefit daily while their mates are in government.
The over-regulated, over-charged, over-ruled, over-educated, over-experienced advisers are being squeezed out of business.
It is easier for the Labor party to say the advisers have left the industry (not a profession) of their own choice, and only the remaining ISF’s are capable of providing (unqualified) advice!
By the time the consumer desperately needs the help, the scummy politicians will have fled the halls of parliament and will be relaxing on their taxpayer funded retirement on some island.
And the consumer can only hear the wails from Canberra, “It wasn’t us. We were only following orders!”