Many financial advisers are groaning under the weight of regulation and the Financial Planning Association says it is already working with the government to make improvements – but no one knows when change will occur.
Most of the points brought up by financial adviser Peter Corrie in a recent letter to Treasurer Joe Hockey are already being focused on by the new Liberal government, FPA chief executive Mark Rantall says.
Corrie had become concerned with the lack of action by the Liberals to correct what he termed “Labor’s regressive over-regulation” and hoped to spur on changes to do with superannuation commission, conflicted remuneration, ASIC power and shadow shopping, and grandfathering rules, among other things.
But Rantall says the FPA is working with the government to help them implement the 16-point plan outlined in their election promises, and that changes will eventually go ahead.
There are four priority areas, says Rantall. These are removing opt in, clarifying best interest duty, reviewing fee disclosure statements and removing the ban on group life commission.
“All these issues are currently being dealt with. What Peter Corrie has brought up are also significant issues for our members.”
The government and FPA are also currently discussing whether grandfathering provisions – which restrict authorised representatives transferring from one licensee to another – need to be fixed through regulatory or legislative changes.
Rantall says it is “hard to say” whether the grandfathering rules came into play through design or chance.
But as Corrie puts it: “The mind boggles as to how this ever got past the goalpost…Their abolition will restore competition in the advice market.”
While the government has promised to fix up the problems plaguing the financial services industry, the timeframe remains unclear.
“That’s the million-dollar question,” says Rantall. “The government’s priority is removing the carbon tax, but it would be great if we could see [financial industry reforms] introduced in November.”
Labor damage control crucial, says adviser
Grandfathering: A way around it for advice firms
Shorten’s shadow ministry causes ‘Ripolls’