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The Industry Super Network (ISN) has sought to use new research it has commissioned to claim that the demand for financial advice would increase by 125 per cent if planners were legally required to act in the best interests of clients.
But the ISN research, undertaken by actuarial consultancy Rice Warner, is referring to one-off advice and intra-fund type advice. ISN chief executive David Whiteley only made a passing reference to the fact that the same research says there would be no significant change in demand for holistic advice.
The Rice Warner research appears to deal almost entirely with the scenarios brought before the Ripoll Inquiry, which consisted of advice on the part of super fund members and others who do not require a holistic approach.
Whiteley claimed it was a “ground-breaking analysis” that provided a blueprint for the Government and the financial planning industry.
The research found that the number of people receiving advice would increase substantially, but acknowledged that this was “largely advice targeted to their needs at a specific time”. It also added that the demand for holistic advice would remain steady.
Whiteley went on to say that the analysis had predicted a sharp increase in financial advice provided by super funds to their members scaled specifically to their needs.
He said the research predicted that total employment of financial planners would remain stable, and then reduce by 2024 driven by efficiency improvements.
Rice Warner appears to have a strong philosophical approach to intra-fund advice, having used its submission to the Cooper Review into superannuation to outline its position. Rice Warner said that while advice is valuable, requirements change over time and a lifecycle approach can be implemented by super funds. It added that “much of the advice delivered in this way can be carefully scripted by experts”.
