There has been a lack of consultation with grass roots advisers around the Government’s proposals for lifting professional and ethical standards, according to experienced Victorian-based adviser, Ian McKenzie.
In a submission responding to the Government’s exposure draft legislation on lifting professional and ethical standards in the financial services industry, McKenzie said he was concerned at the lack of consultation with grass roots advisers with respect to both the findings of the Financial System Inquiry and the Parliamentary Joint Committee.
Further he said there had been no economic or social impact done on the on the proposed legislation, especially with respect to its impact on the existing stock of financial advisers, small business or the wider community.
McKenzie’s submission expresses deep concern that the changes being proposed by the Government may see a significant exodus of experienced advisers and urged grandfathering in similar terms to that being urged by both the Financial Planning Association (FPA) and the Association of Financial Advisers (AFA).
He said there was a real danger within the exposure draft legislation that adviser stocks would be damaged, undermining Australia’s aspirations to become an Asian financial hub.
However it on the legislative proposal to establish a new over-arching standards-setting body that McKenzie is most vocal, arguing that it is unnecessary in circumstances where the Accounting Professional and Ethnical Standards Board (APESB) already exists.
He said the APESB had been formed by the three professional accounting bodies and should be possible for the financial planning bodies such as the FPA and AFA to join the APESB and effectively bring the accounting and financial planning professionals under a single code of conduct.
“Why spend millions of dollars setting up a new standards board when one already exists and probably covers around 75 per cent of financial services practitioners and probably most likely already has the infrastructure and human resources personnel in place to handle the codes of conduct of financial advisers,” McKenzie’s submission said.
