Access to high-quality advice for consumers will be a key priority for the Labor government, according to shadow minister for financial services, Stephen Jones.
Speaking at the Association of Superannuation Funds Australia conference on the Gold Coast, Jones said Labor wanted to ensure advice was affordable to consumers.
“We will seek to fix the mess the Government has made in financial advice
“Australians have never been retiring with more wealth but they have never found it more difficult to get advice they need to make those retirement savings work for them.
“We want to ensure that Australians can access high-quality, safe, professional advice at a price point that works for them.”
His comments followed research by Adviser Ratings that found the average cost of advice had risen 40% in the past three years to $3,256 while 100,000 people had been orphaned or ceased receiving advice.
Meanwhile, he said it was important to end the ‘super wars’ between different parts of the superannuation industry.
“We see an important role and a strong value in a competitive retail sector. Competition, innovation and performance, bringing new ideas or new products to the market and new ways to serve our customers. This has got to be a part of the future of our system and it will be enhanced by a strong retail sector,” he commented.
“We want to see strength in all superannuation funds. A rising tide lifts all boats.”
Comments
Hahaha. The architects of the current regime now want affordable advice? They will just tie us up in more red tape.
100% agree.
They created the merciless vendetta against Financial Planners in order for their union super funds to prosper and kickback millions to their political party.
Everyone in our FP community: don't be fooled by voting Labor, as a dumb 'protest vote'. Their solution to 'affordable advice' will be enforcing insanely capped fees across our businesses, regardless of our operating costs.
Don't think that is possible. Coalition already exhausted the supply of red tape. Nothing left. Having said that, Jones is blowing the chance of winning over thousands of angry advisers. Other than the blunt 10 year education proposal we haven't seen a single policy or promise of any substance to back up their rhetoric.
Dear Mr. Orwell,
Re, ".... already exhausted the supply of red tape"
I am not so sure about that. I think there is a lot more red tape to come.
I am actually forecasting, (and preparing for) monthly or at least bi-annual FDS, and Opt-in notices after the review from Michelle Levy. I know you all think I am crazy, but as Andy Grove (founder of Intel) once said, "only the paranoid survive"
politicians and bureaucrats have an infinite level of stupidity (when you never have to be accountable and you are working on someone else's dime you can).
as Einstein once said, "there are two things in the world that are infinite, the universe and human stupidity and I am not sure about the former"
so I urge all my dear and professional colleagues to prepare for a monthly FDS and Opt-In. you might think it is an impossibility or at least improbable, and utterly stupid. but, all I ask you to do before you flame me is to think about the "outcomes of previous reviews" and to look at where we are.
As the Labor Party is a direct beneficiary of the channeling of monies via Trade Unions as a result of Industry Super Fund Directors electing to transfer their fees to Trade Unions or their related entities, it is ridiculous to accept they will do anything at all to cease this conflict of interest in relation to favoring Industry Super Funds over retail funds every single time.
If an Industry Super Fund Director elects not to receive their fee, it must be mandated that the fee be returned or withheld within the fund for the benefit of the members.
If this is not changed, it is a direct political conflict of interest.
If Labor won the election, it is utterly unacceptable that a Govt in power could be a beneficiary of redirected funds from Industry Super.
We are not talking about some unimportant level of funds, we are talking about tens of millions of dollars every single year being channeled via Trade Unions.
Sounds simple in theory, but if this was the rule what stops these directors taking the fee, and then voluntarily donating this money to the ALP out of their own pocket? In any case, given the current Government hasn't laid a finger on unions for 8+ years, even if they got back in they wouldn't do anything to stop them.
If the Director’s receive the fee, is the fee then taxable income?
If they elect not to receive the fee and elect to donate the fee to a Trade Union entity, how are those funds then treated?
All true, but this has been going on for many years under both sides of politics. It is no surprise that Labor in government tilts things in favour of union super funds. What is surprising is that the Libs have done so little about it. This goes right back to the Howard era when union super started their misleading and deceptive advertising in the mass media and the government ignored it.
The Libs have been asleep at the wheel in relation to the dodgy practices of union super. They need a thorough personnel refresh, with young backbenchers like Wilson, Falinski and Bragg who do take an interest in this issue, given more prominence. That is best achieved through a spell in opposition.
Just another politician re-imagining what really happened. The ALP fought hard on behalf of their union fund masters to demonize the financial planning profession and designed the current unworkable regulations. They never once objected to the implementation of the poorly constructed recommendations of the Royal Commission, in fact they said they would go harder. So Mr Jones, your attempt to take the higher morale ground here is insulting and only proves why you will be no better placed than the current incompetent government to fix this issue.
the mess the current government created? Really? You all were the architects of this fiasco, screaming and yelling about all the scams going on then handing the royal commission to someone totally out of their depth. I've noticed over the past couple of years as we've orphaned low revenue clients due to our rising costs that the amount of hassles has decreased enormously. We'll stick to the high end of the market, the industry funds and BT Panorama can have the orphans. I've been doing this too long to get excited by comments from Jones or Hume. they speak but they don't listen.
Where were you Stephen when we were screaming out to you for support? You ducked and weaved just like Jane Hume!
As the Labor Party is a direct beneficiary of the channeling of monies via Trade Unions as a result of Industry Super Fund Directors electing to transfer their fees to Trade Unions or their related entities, it is ridiculous to accept they will do anything at all to cease this conflict of interest in relation to favoring Industry Super Funds over retail funds every single time.
If an Industry Super Fund Director elects not to receive their fee, it must be mandated that the fee be returned or withheld within the fund for the benefit of the members.
If this is not changed, it is a direct political conflict of interest.
If Labor won the election, it is utterly unacceptable that a Govt in power could be a beneficiary of redirected funds from Industry Super.
We are not talking about some unimportant level of funds, we are talking about tens of millions of dollars every single year being channeled via Trade Unions.
You lot of complainers would not be in business if it were not for the Australian Labor Party beginning in compulsory superannuation. The ALP gave you the gravy train. You lot spoilt the nest egg by lack of discipline. That said, the margins for financial planners have become too thin with over regulation, excessive red tape, constant changes for bald political reasons, high advice costs, unregulated robo-advice competition and the rest.
Elements of what you say are correct. Sad isn't it. Governments accepted low standards so that Trillions would be pumped into the Super system creating one of the biggest sectors in the economy. After they got there honey pot both Labor and Liberals blamed those Advisers for the sins of AMP and CBA, whilst ignoring the lies, false & deceptive marketing of Industry Super funds. Maritime Super getting fined $26,640 for lying to members about fees adversely impacting 77% members whilst the fine for spelling mistake in a Fee Disclosure Statement is $100,000 and life long ban. Clear evidence foolish planners have been and will be used and abused again. Now as we return to Labor those Human Advisers not with Masters Degree will be replaced by a free APP on AustraliaSuper website and special advice carve outs for Industry Super funds. Are Planners the stupidest people on Earth?
You make good points, but financial planners are valuable people and should be respected (except for the narrow minded or naive ones). People need financial planners given the governments of both sides (and the idiot Greens) are making so much of a mess of people's personal finances.
Hedware!!...I thought you must have died.
No commentary Hedware regarding the transfer of Industry Fund Directors fees to Trade Union entities ?
The Rivers of Gold paper completed a few years ago exposed the multiple millions of dollars every year that get funnelled into the Labor Party's coffers via Trade Union donations that have been generated from the re-direction of their fees.
Not surprising at all after tracking your responses over the last 5 years or so.
You consistently fail to recognise this blatant, conflicted and abusive practice.
That kindergarten book Rivers of Gold was written by the IPA and for the IPA. It was written with short words, in big print and has pretty pictures. The naive and ignorant believe it.
Never any mention of the money being channelled by the big four, the legal firms, the super business, the banks and the rest via the blind trusts, the tax benefited lunches, and the hidden accounts into the pockets of the Liberal Party. Never mind the hypocrisy.
Wait a second Mr Hedware. Your comrades in the ALP party are "complaining" about this issue too, in fact it's the point of the article. All the comments are saying is it is a bit rich for the ALP to take shots at the Libs when they are just as guilty. It is also quite amusing that you label everyone complainers and then acknowledge all the issues being raised. So aren't you a complainer too?
Yes I am a complainer and should have added useless bodies representing financial planners to my list of complaints. But I am not complaining about the new education requirements as I believe they help underwrite financial planning to be a profession comparable to other professions.
There's more to financial planning than just superannuation funds. The unenlightened ones here keep banging on about industry super and trade unions and other windmills but the world has moved on and there's bigger and newer issues to be addressed and assisted by financial planners.
For the record, I was five years old when super became compulsory in Australia.
To suggest that people commenting on here received a "gravy train" from the ALP on the introductory of mandatory super in 1991 is poor.
Actually it is insulting - especially in a post FOFA, post RC world.
Your comment is poorly considered Hedware.
That would make you 36,,,You might have to change your name to Old Brian, old man.
But it is true. Prior to compulsory superannuation, wage earners had superannuation via their industrial awards or via the armed forces and public sector. The only ones who had and could afford financial advisors/accountants were at the top of the executive pile.
Before compulsory superannuation, there were very few financial products in comparison to what we have today. Savings accounts were the only financial vehicle for most people. Accordingly that meant there were few financial advisors compared to the numbers that we have today. There's background papers in issues of the Australasian Accounting Business and Finance Journal and Authors.
Saying that compulsory superannuation doesn't count because you were only six at the time is like saying the victory in World War II had no impact on you because you were not born. That's like saying you cant invest in BHP because it was started before you were born.
And it has been a grave train. But I should have qualified that remark that it was those CEOs, senior executives, investment managers in the wealth management companies, banks, insurance firms, etc who really got on the gravy train and was not really financial advisors and I apologise for that. The fees they charge in Australia are about twice as much as in other equivalent countries.
Howard was considering compulsory superannuation when he was Treasurer prior to Keating. Howard, Costello and Abbott deferred contribution increases and thereby reducing the pool for investment product companies and superannuation funds and reduced some flow-on benefit to financial advisors.
Freydenburg made big announcements that he was going to implement all recommendations of the RC but has shelved about 65% of them without any of his usual fanfare. Some of the ones he silently shelved would have been in the interest of financial advisers. So it's a pale post RC world.
Obviously not my real name - 1985 was a good year.
Hedware - yes it is great that there is a super system for all Australian's and no doubt this is a generally accepted fact. Our system has its flaws but relative to competitor peers across the world Australia does this quite well. It should always aspire to improve.
With regard to your point though - I'm arguably still alive thanks to medical breakthrough such as penicillin nearly 100 years ago. Perhaps I'm also here because a distant relative decided to set fire to his local tavern back in Minchinhampton and received a 14 year (free of charge) adventure to Botany Bay. Perhaps I should thank some ancient civilization for inventing money.
I get what you're saying but how far do you want to go?
In my experience, I get no reward from super product and strategy recommendations and nor should I.
I am however afforded the ability to advise on helping the Australian public use their super with the view to achieve better outcomes. Keep in mind that not all of these outcomes are purely financial which is something that needs to be captured much better than it currently is. That's really what the opportunity set from compulsory super has been for me.
Without this system, no doubt, I would have less clients.
There are a large cohort of advisers out there who have jumped through a million hoops, from FOFA to RC, FASEA and beyond who are heavily invested in their careers, provide value to the public and do this responsibly. Its only fair they want to have financial advice recognised as a profession, along with having their esteem and value in the community lifted.
As you can appreciate I had strong objections to your thoughts about advisers being on a 'gravy train' purely as a result of the super system existing - I appreciate your recognition regarding advisers in your above post.
I think that you'd largely agree with the sentiments I've expressed here given your other posts.
Hedware - I also meant to ask, which of the unimplemented Hayne recommendations do you think should have been implemented in the interests of financial advisers?
Notice there are only crickets on here when Richard Hedware is asked questions like that
I believe the report on Treasurer’s delivery of the Hayne recommendations was in the AFR and published late last year. I thought I had a copy but no success in finding it nor online. Perhaps the Treasurer’s office might be helpful.
Could it be argued that having politicians/legislators with strong connections and arguable conflict of interest with certain product providers could be considered as an extension of vertical integration?
The problem- Access to affordable Advice.
The solution- Creating further Carve outs for 12 Union industry super funds to give Advice, via Call Centres, Apps and Website tools, thereby expanding access to advice.
Unfortunately this may mean some human lead advisers working outside of those super funds will be terminated but those job losses will be adsorbed by other sectors in the economy.. Best you start learning "Welcome HestaSuper Advice How can I help you"
It's a business decision. How does a business decision get up the noses of you very pro-business acolytes? It's like onshoring or reshoring manufacturing now being taken (probably more so in the US). Offshoring employees has its downsides as many businesses are now finding.
Any way you lot are so anti-industry funds and so why would an industry fund outsource advice to a bunch of anti-industry funds advisers. Hopefully those financial planners who advised their clients regardless of clients' superannuation fund will remain in business despite the antics of their less informed brethren.
If indeed we were a 'profession' then why is it that it appears we have two different sets of rules as to the rigour required by practitioners to provide advice being contingent on whom your employer is?
Considerations to the equity underpinning this are concerning. It is no surprise that such angst exists and largely wouldn't exist if the playing field was perceived within the advice community as being level.
Although there maybe higher order issues within advice currently, this matter is not trivial. To suggest that people who have concerns regarding these observations and perceptions are, "complainers, unenlightened and less informed" is unfair and misguided.
Furthermore, if conflicts of interest between interested parties and product providers are not managed correctly or equitably, then this serves only to undermine and erode confidence within the financial advice community even further.
It is not unreasonable expectation that financial advisers should seek transparency and equity when it comes to these matters moving forward.
I don't disagree with any of your well made points - except for your support for the "complainers, unenlightened and less informed". Going over old wounds and harping on about industry funds is not facing up to the very uncertain and worrying future that is presenting itself.
We need King Solomon around to solve the point you make in your first paragraph. I dont think we will find him today in either of the two organisations.
Apparently the red tape machine has run out of tape…..at the moment.
Both Labor & Liberal have ordered massive new supplies of red tape but are deliberately not taking delivery until after the election.
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