Advisers worried about the cost of the single disciplinary body

Faced with increasing costs which are adding to the pressure on financial advisers, industry organisations have signalled they are going to be pressing the Federal Government to absorb or at least mitigate some of the cost of the new single disciplinary body.

As well, they are concerned at the likely cost of the annual registration fees which will have to be paid by advisers.

On the back of the Government on Monday releasing the exposure draft legislation which broadly explains how the new single disciplinary body will work, there was general agreement among industry executives that some rationalisation of costs was needed in circumstances where the new structure entails pre-existing systems and operations.

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Association of Financial Advisers (AFA) acting chief executive, Phil Anderson said that it had always been inevitable that the establishment of the single disciplinary body would bring another layer of cost and it was important to recognise the impact.

He said the AFA would be making a comprehensive submission to Treasury responding to the exposure draft legislation which would include pointing out the manner in which financial advisers and licensees were already being impacted by regulatory costs.

A number of dealer group executives told Money Management that they believed the Government should be urged to use the establishment of the single disciplinary body as a catalyst for an overall review of the regulatory layers, particularly in circumstances where the Financial Adviser Standards and Ethics Authority (FASEA) was being removed, and the those of the Tax Practitioners Board (TPB) subject to some consolidation.

However, they said that the recent substantial increase in the Australian Securities and Investments Commission (ASIC) levy had left many advisers concerned about their continuing financial viability.

“They will doubtless want to delay any wind-back of the existing regulatory structures until they see how this single disciplinary body structure works, but they simply cannot continue to just build one layer of regulation and cost on another,” a senior executive said.

“They cannot hope to achieve a more affordable advice environment if they keep imposing regulatory layers and costs.”

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The Government wants us out, plain and simple. To get into the profession as a newbie takes about as much time as becoming a Dr or Solicitor, 5 - 6 years. Then being faced with a multitude of regulations and registrations that often contradict each other plus the exorbitant costs, why would you bother. And even if you do a good job, miss a couple of reviews and you can rebate your fees, yet you're still responsible for the advice you gave., Oh, and your professional bodies sold you out years ago without thinking ahead that they are cutting off their own cash flow, realising this now that it's far too late. So please go ahead and add another layer of fees and compliance to our world, we've closed the door on new clients and will start shedding existing ones that we can no longer carry with us under all this rubbish.

It's not a SINGLE Disciplinary Body at all. It's ANOTHER Disciplinary Body, on top of AFCA and ASIC.

Hume is a complete liar to say she is implementing Hayne's recommendation. This is just more regulatory cost and complexity, which will make it harder for consumers to access professional advice.

MIA Jane Hume, please explain how many Regulatory bodies, or bodies within other existing bodies we will have.
We started last year with 9.
How many more do you want to add.
How does single = 9 ?????
Only a politician could Lie and Smile so well.

# 10 and counting. more to come.

the best thing advisers wanting to exit can do for the few remaining is to leave as quickly as possible so the whole thing just collapses.

This will only result in another million low-income families losing access to financial advice. This Fed Govt has totally lost the plot.

Please explain what the end goal is? Is it one entity, or is it a new entity and also FASEA, ASIC, TPB, AFCA etc.

There is an issue buried in the new draft legislation the media hasn't picked up on yet. Being a member of a professional association will no longer be recognised as an option to qualify for the provision of tax financial advice. Potentially, this means thousands of financial advisers will be required to complete more study (ie. a law course and a tax course). Although there is this note in the Q&A document on page 14 'To provide tax (financial) advice, an adviser must meet the additional education and training standards set by the Minister'. What does that mean? Is Jane Hume about to announce a whole new raft of education requirements? The only things certain about financial planning these days, is disruption, uncertainty, risk, costs and red-tape

Agree that this is potentially a huge issue Giggity. Particularly as it's meant to apply from 1 Jan 2022. How will advisers be able to get the required study done in time, particularly when 8 months out from the deadline the precise study requirements haven't even been specified yet?

This looks like yet another sly attempt by the govt to prevent consumers from accessing professional advice, and push them into real estate speculation and dodgy direct products.

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