With the election taking place on Saturday (3 May), Adviser Ratings examines how the two major parties could shape the advice industry in the future.
Leading the incumbent Labor Party is Anthony Albanese, while the rival Coalition party of Liberal and Nationals is led by Peter Dutton.
Current Minister for Financial Services Stephen Jones will also retire at this election, so whichever party wins this weekend, there will be a new financial services representative.
Labor:
- Continue implementing the DBFO reforms, potentially with adjustments based on industry feedback and the preferences of a new Financial Services Minister, given the retirement of Stephen Jones from Parliament.
- Address the CSLR sustainability issues, though specific solutions remain unclear.
- Proceed cautiously with the new class of adviser framework.
- Maintain the current trajectory of regulatory oversight.
Liberal:
- Implementing advice reforms within 100 days of taking office.
- Targeting a doubling of the adviser population to 30,000.
- Potentially compensating advisers who left the profession due to regulatory changes.
- Conducting a comprehensive review of the CSLR.
Commenting on the policies, Adviser Ratings said: “The profession has successfully weathered its most tumultuous period, emerging more independent, more efficient, and more client-focused. Now, the regulatory decisions of the next government will determine whether this positive trajectory accelerates or faces new headwinds.
“What’s clear is that the coming regulatory changes will significantly impact not just adviser business models but also broader access to financial advice for Australians. With median advice fees having jumped 67 per cent over five years to reach $4,668, addressing the growing advice gap will require both innovative business models and supportive regulation.
“The profession now has the foundation for sustainable growth – the election will determine whether the regulatory environment enables or hinders this potential. Those advisers who proactively prepare for the regulatory shifts ahead will be best positioned to not only survive but thrive in Australia’s evolving financial advice landscape.”
What have the parties said so far?
Jones has said that, from the Labor perspective, the party needs more time for implementation of measures. Speaking at Momentum Media’s election breakfast last month, Jones said his party had “significantly” moved the dial with its Delivering Better Financial Outcomes legislation.
This has included measures around replacing Statement of Advice with client advice records, modernising best interests duty, and creating a new class of financial adviser.
“I think that we have moved the reform dial forward significantly. I can’t think of a time in my time in Parliament where we’ve had a more mature debate around the issues affecting this sector,” he said.
“We really do need to have a very clear-eyed focus on what we’re trying to do here. What we are trying to do here is to ensure that Australians have access to the information and advice that they need, when they need it, in a safe format.”
Jones has also been critical of the Compensation Scheme of Last Resort, a policy disliked by many advisers, and said it is “unsustainable” in its current iteration.
Frontrunners to replace Jones include Andrew Charlton, Jenny McAllister, Andrew Leigh, and Daniel Mulino.
Meanwhile, the Coalition has an “ambitious agenda” that has received support from industry bodies but faces questions about whether it will be able to implement these ideas in reality.
Angus Taylor, shadow treasurer, told delegates at Momentum’s event that rebuilding the advice profession should be a key priority going forward and targeted achieving 30,000 advisers. This would be almost double the volume of advisers currently.
“This is crucially important. This won’t be just optics or words; this will be driven down into the way we want our regulator and regulation of this industry to work. The numeric target will be embedded in ASIC statement of expectations,” Taylor said.
Shadow financial services minister Luke Howarth reiterated this goal, calling it a “north star” for future advice reform, though he said that a time frame on reaching the 30,000 number has not been set.
In a separate speech, Taylor also said he will introduce a Securing Australia as a Financial Centre Bill within 100 days that will include reforms such as restoring the financial advice profession.
