Powered by MOMENTUM MEDIA
moneymanagement logo
 
 

Grandfathering removal a policy 'black hole' says AFA

association-of-financial-advisers/AFA/phil-anderson/australian-securities-and-investments-commission/ASIC/Royal-Commission/legislation/grandfathered-remuneration/

1 October 2019
| By Mike |
image
image image
expand image

There is a desperate need for certainty and guidance around the removal of grandfathered remuneration in circumstances where none of the submissions presented as part of the Government’s consultation process have been published, according to the Association of Financial Advisers (AFA).

What is more, the AFA has urged that implementation of the legislation be put on hold until the implications are fully known.

AFA general manager, policy and professionalism, Phil Anderson, said that there was a serious dearth of information available to the industry in circumstances where other than a recommendation from the Royal Commission and a few supporting statements, all the Government had delivered was a statement of intention and now the legislation.

“The consultation process has been limited to consideration of the draft legislation and, to the best of my understanding, there has been no formal consultation events,” Anderson said in an analysis published to members.

“It is now seven and a half months since the release of the Royal Commission final report and we still have nothing. There is no guidance and no consensus on what needs to be done.”

Anderson said that the Treasury had run a round of consultation on the draft grandfathered conflicted remuneration legislation that closed on 22 March, but six months later the submissions received by the Treasury had not been released despite the legislation passing the House of Representatives and sitting in the Senate.

“Surely the release of these submissions should assist the consultation process and inform the debate,” he said. “A further round of consultation occurred with respect to draft regulations, however submissions in response to this have not been published either.

“In the current information vacuum, product providers, licensees, fund managers and financial advisers are looking for guidance. The time has come for the Government, the Australian Securities and Investments Commission (ASIC) and product provider organisations to deliver,” Anderson said.

“Face to face round table consultation and further research is essential to develop a detailed understanding of the complexity of the issue. The passing of this legislation should be put on hold whilst the work is done to understand the implications of this reform and to allow for sensible solutions to be developed. Otherwise this will inevitably go down in history as a policy disaster.”

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest news and developments in wealth management industry

MARKET INSIGHTS

Significant ethical issues there. If a relationship is in the process of breaking down then both parties are likely to b...

3 weeks 1 day ago

It's not licensees not putting them on, it's small businesses (that are licensed) that cannot afford to put them on. The...

4 weeks 1 day ago

So we are now underwriting criminal scams?...

7 months ago

After last month’s surprise hold, the Reserve Bank of Australia has announced its latest interest rate decision....

3 weeks 3 days ago

WT Financial’s Keith Cullen is eager for its Hubco initiative to see advice firms under its licence trade at multiples which are catching up to those UK and US financial ...

4 weeks ago

While the profession continues to see consolidation at the top, Adviser Ratings has compared the business models of Insignia and Entireti and how they are shaping the pro...

1 week 2 days ago

TOP PERFORMING FUNDS

ACS FIXED INT - AUSTRALIA/GLOBAL BOND