Opposition seeks to retake initiative on advice legislation
The Federal Opposition has moved to reassert its credentials on financial planning legislative reform via a Private Members Bill which effectively steals a march over the Government’s second tranche of the Delivering Better Financial Outcomes legislation.
The Private Members Bill has been introduced by Queensland Liberal back-bencher and former financial adviser, Bert van Manen and seconded by Shadow Assistant Treasurer and Shadow Financial Services Minister, Luke Howarth.
At the heart of van Manen’s bill is a simplification of the statement of advice (SOA) requirements with the objective of financial advisers being required to do no more than that provide a Letter of Engagement and a Record of Advice to any client.
News of the van Manen’s bill was timed to coincide with the annual conference of the Association of Independent Financial Professionals (AIOFP) in Canberra.
In announcing his move, van Manen claimed that the Government was moving too slowly on its advice changes.
“Financial planners and advisers have waited patiently for the Albanese Government to act on Levy’s recommendations. Time is running out before an election is called and I have decided to act by bringing forward the most impactful reforms for the advice community,” he said.
For his part, Howarth said Labor’s inaction on financial advice reforms is leaving Australians under- advised and under-insured.
“We are fast approaching 700 days since Michelle Levy handed the Albanese Government her Quality Advice Review’s final report. The Government has failed advisers by leaving implementation of the Review’s most important red tape reducing recommendations to the very last minute.
“Action on reforming the burdensome SOA process is long overdue and these reforms will significantly reduce the time and cost of providing advice,” Howarth said.
The Assistant Treasurer and Minister for Financial Services, Stephen Jones signalled late last month that he expected the second tranche legislation to be introduced to the Parliament early next year.
A good start by the coalition, but it’s still only a drop in the ocean. If QAR was implemented in full, it would only fix about a third of the bad regulation that makes professional financial advice too complex and expensive for most consumers. By this time Labor should have implemented QAR in full, and be making good progress on the other two thirds of bad regulation. Things like the morally hazardous CSLR, the unnecessary AFCA, the inappropriate licensing model, the unwieldy Corps Act, and the dysfunctional ASIC.
This is smart as it separates SOA bloated rubbish that no one is wanting or debating should be majorly reduced.
Away from Qualified Advisers / BackPackers sales agents that is what Jonesy has tied together to try to
appease Real Advisers getting screwed with a small gift of reduced SoAs.
As long as the RoA provides simply a Record of the advice provided ie as per file notes and does not simply become, particularly after the lawyers get hold of the concept, a SoA, in it’s current format with an alternative name, which is what I fear is likely to eventuate