THEY ARE AT IT AGAIN……
Whilst the 2022 change of Government has been a pleasing outcome for the Advice community, the AIOFP is concerned the Institutionally aligned lobby faction [Institutional lobby] is still actively trying to tilt industry outcomes in the Institutional sectors favour.
We don’t believe the current Bank rhetoric around having no interest in wealth management is credible, we suspect they are trying to create more alluring market conditions by stealth to suit a reintroduction of a digital version of vertical integration. Clearly, a Good Advice obligation is preferable and less legally onerous than a Best Interest Duty for the Banks to operate under.
Why else would a major Bank make a public statement that they are no longer interested in advice? Is it to allay fears around Banks wanting to get back into advice? Why say anything? We are bemused with this position, we think Banks are very good at most things financial, but Wealth Management/Advice is not one of them. The recent Royal Commission outcomes support this fact.
When you consider that the QAR was introduced by a Bank friendly Liberal Government and is focussed on removing a best interests duty whilst being camouflaged by some other sensible reforms, it appears highly suspicious in our view.
To add further weight to our position, the long-term alliance between the Institutionally aligned FSC and FAAA [FPA/AFA] is still in place where both are strongly pushing for the abolition of the Best Interests Duty by adopting the QAR recommendations. This is clearly against the best interests of consumers/professional Advisers, favours the Institutions but all masqueraded under the narrative ‘we need more Advisers’ due to the mass adviser exodus from the industry over the past 8 years.
You may recall this culling of Advisers was due to the LIF/FASEA/Grandfathering devastating legislation, you may also recall who Minister O’Dywer thanked for supporting the legislation in 2015 – see the attached if you have forgotten.
We are also concerned that the ‘divide and rule’ political tactics implemented by the Institutional lobby over the past 25 years to disrupt the Advice community are still being used at industry forums. It certainly appears Associations, who have no, or minimal, financial advisers are being inadvertently used by the Institutional lobby to support their agenda via the JAWG alliance. With all due respects, most of these Associations are Adviser fringe at best and should stay away from the Advice industry politics.
We will reiterate our position on the Best interests duty, Good Advice and unlicensed staff of Superannuation funds/Institutions giving product related information to consumers –
- Best Interests Duty – it needs to remain in place to protect consumers from conflicted behaviour in the financial advice process.
- Good Advice – it may be relevant where Super/Institutional unlicensed staff are providing product related information to consumers, yet to see the detail.
- Product Information – we think all Superannuation/Institutions/Life Office should have trained staff delivering internal product related information to consumers without the need to comply with the law. Anything outside of that they must comply.
It is time for the Advice Community to start analysing the political ‘tea leaves’ leading into the 2025 Federal election.
Peter Johnston
Executive Director
