Govt needs to create ‘meaningful’ change

If the Government wants credit for helping the industry it needs to do more to drive “meaningful” change, rather than fixing no brainer issues, according to Lifespan Financial Planning.

Eugene Ardino, Lifespan chief executive, said the Government had fixed things that needed to be fixed but would not deserve full credit until meaningful change was completed.

“The way I see it they [the Government] are fixing things that need to be fixed, some of the things they’ve come out with were no brainers,” Ardino said.

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“Maybe I’m being too rough on the Government, but the Government doesn’t deserve credit for doing it, they deserved to be criticised if they didn’t do it.

“If the Government wants credit, they need to look at meaningful change to actually acknowledge that you can regulate an industry out of existence and do away with all misconduct.

“If you have no advisers, you won’t have misconduct. If you have no clients, you won’t have misconduct. But there’s got to be a balance.”

However, Ardino said there was positives to come out of this upheaval for those that stuck it out, despite it being a fast-shrinking community.

“We dipped under 19,000 [advisers], I expect us to get closer to 15,000 over the next 12 to 18 months and possibly to go down further,” Ardino said.

“That’s a massive opportunity for those that stick it out and stick around, and I genuinely believe that at some point the Government is starting to take note of how over-regulated our community is and I think we will see the pendulum swing back.

“I guess the message is hang in there, things will get better. It’s important there are advisers left at the end of this because consumers need you.”

One of the few advantages of the Royal Commission, Ardino said, was consumers were much smarter about the industry and this had been missing from society.

“One of the main positives to come out of the Royal Commission – and there are a lot more negatives to come out of it than positives for consumers – but one positive to come out of it is we have more of an alert consumer now,” Ardino said.

“The Royal Commission is causing consumers that get advice or any financial service to take more ownership and interest in what they’re getting.

“We make it hard because of the volume of stuff that we give them to read but the consumer is more alert. Not necessarily more aware, but more alert.

“That should give us more comfort that if you have an unscrupulous service provider that they’ll be found out.”

Ardino said he believed there was a spike in mental health concerns in the advice community this year.

“I think it’s the coming together of all the new legislation, the education deadline around the corner – yes, there’s an extension, but there’s confusing over what extension actually means and that will be there until the relevant legislations are amended,” Ardino said.

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The only way to get this decrepid coalition government to make meaningful change, is to put them into opposition. Only then will they wake up and start listening.

100% agree, Frydenberg, Hume, LNP & ASIC continually loading up the BS Red Tape truck and Dump Dump Dump ever increasing BS compliance costs onto Advisers who then have to charge clients for this useless rubbish.
They have them made the smallest of recent changes only because their initial legislation was so freaking stupid.
And somehow they think now they are wonderful.
What will be wonderful is helping vote these clowns out and help force an ASIC clean out too, starting with Ms Press.

Yep, in one term of government, the Coalition have turned their biggest supporters and advocates, into their no.1 enemy. The Coalition have dramatically underestimated financial advisers, and the influence we have among our networks. Karma will be a bitch at the next election. Every financial planner I know is turning on them big time.

You have just woken up to why it is better to live in a marginal electorate than a safe electorate. Marginal seats means sport rorts, car park rorts, Porkbarillo grants and the other bribes. It makes sense for the financial planning fraternity to work both sides of the political divide instead of being Coalition flunkies. In what's going on, financial advisors are not the main game and with a small network, are not influential compared to the other players.

Our networks are small? Are you serious? There are more than 2 million financial planning clients in Australia. Each is having their fees jacked up and getting spammed with ridiculous multiple fee consent forms which are between 4-7 pages long, getting posted due to the pandemic, thanks to this clueless government. Their normally pro-coalition adviser is bitching about the nonsense government and blaming this crap on them. If you think this is not influential, you are making the same mistake as Hume and Frydenberg. Financial advisers are massively influential, but we have never used our influence,.... until now

I had wondered about the client base and whether they would come to the party. But there's reasons why they wouldn't be interest in being supporters. Most would want greater protection, not less, of their investments and super funds and have heard enough stories about dodgy advisors to be in the over-regulation camp. Every time a bank does something naughty then the whole finance industry, including advisors goes into disrepute. The financial advice industry does even have one voice.

Clients want an appropriate level of consumer protection. They don't want excessive bureaucracy that adds no benefit, but does add to their complexity and costs. It is a fallacy that more regulation means better consumer protection. If regulation is badly designed and excessive, it is counterproductive. Unfortunately that is what has happened in financial advice.

Normal people understand this. It's only bureaucrats and activists who have trouble understanding the concept. Clients can see quite clearly that financial advice has been badly regulated. Clients are also aware that most advisers are competent and trustworthy, and "dodgy advisors" are far less prevalent than media hysteria and union smear campaigns try to convey.

You are making the same mistake as the govenment hedware. Think about it - Do you seriously think our clients consider 2-5 fee consent forms each 4-7 pages long equates to 'greater protection'? Do you think our clients like paying higher fees? Do you think they like it when they can't contact their adviser because they are on study leave? Or they can't book an appointment at a time of their convenience due to the adviser being bogged down with govenment red tape. Heck most don't even read statements of advice because they consider it to be over-the-top red tape. Our clients are accutely aware of the red tape overload and large numbers of our clients are sensitive to our political views. Our influence has been massively underestimated. We quietly went about our business as a strong, long-term ally for the coalition. But they have now turned the vast majority into their enemy. Good luck to Labor. They have done nothing to earn our votes and advocacy. But if they are smart, they may win some us over for more than one election.

Clients want protection to some point yes, that is why they see a Financial Planner. Clients of Financial Planners are also aware that no consumer protection is available for Intra Fund Advice, nor is there any Consumer Protection if the "Balanced" option of HostPlus fails.

You have clearly demonstrated on this one Hedware that you are not a Financial Planner. "I had wondered about the client base and whether they would come to the party"

Keep wondering and think it through. Liberals at this stage clearly have not otherwise Treasury would be cleaned out - drain the swamp.

What a load of meaningless ramblings.

How so exactly Hedware?

The way the article is presented may be rambling, but there are some very salient points underlying it. Let me give you some specific examples.

The government recently relented on forcing advisers to "report that there's nothing to report" as part of the new DDO regulatory overhead. This was met by self congratulatory noises from many quarters about how effective the industry groups had lobbied and how wonderfully responsive the government had been in removing it. This is exactly the type of no brainer fix undeserving of credit that Ardino is referring to. It never should have been there in the first place. The whole DDO thing is unnecessary regulatory overhead that will just increase the cost of advice and products for consumers without providing any additional protection. But the "reporting that there's nothing to report" elements of it took regulatory insanity to a whole new level. Meaningful change would be scrapping the whole DDO along with a host of other unnecessary and confusing disclosure requirements.

Removing advisers from TPB control is another no brainer fix. Advisers should never have been included in TPB in the first place and the government's own review into the TPB recommended removing advisers from its control about 2-3 years ago. But the government sat on this recommendation and did nothing. Then Hume rolls out her fake "Single Disciplinary Body" and tries to take credit for removing advisers from the TPB. The government doesn't deserve the slightest credit at all for belatedly implementing a no brainer fix that was recommended years ago. They definitely don't deserve any credit for trying to claim this change as part of a deceptively named "Single Disciplinary Body" when advisers are still subject to numerous other disciplinary bodies such as AFCA, ASIC, associations, and licensees. Meaningful change would be implementing a genuine SINGLE disciplinary body as recommended by Hayne, that replaces the multitude of other overlapping bodies.

Anon - you have identified two adjustments which are no brainers and hard to figure how they came into being in the first place. But this could have been said in two focussed sentences.

Hedware your original comment, and in fact most of your comments on this website, suggest you need long and repeated explanations to understand what's really going on in financial advice.

No harm in agreeing with someone. No harm in being broadminded. No harm in taking on new information or facts. No harm in seeing both sides of an argument or a position.

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