The Royal Commission was not the font of all wisdom on the question of financial advice and the Government was never under any obligation to implement 100% of its recommendations, according to a Government Senator who was the former chief of staff to former Finance Minister, Mathias Cormann.
What is more, he warned the Senate that the bill and some others derived from implementation of the Royal Commission recommendations would simply drive up the cost of advice.
West Australian Senator, Slade Brockman, won the plaudits of a large number of financial planners when he stood almost alone in questioning the Government’s passage of legislation imposing annual renewals on financial advisers.
Brockman used his speech in the Senate dealing with passage of the Hayne Royal Commission Response Bill 2020 (on Annual Renewal) said he feared that the suite of changes made to financial planning over the past decade “has created an environment where the cost of advice will increase and some Australians will not be able to afford high-quality financial advice and so will be forced into more set-and-forget products, like superannuation”.
“In an environment where you have best-interest obligations and where you have an end to trailing commissions, perhaps something we could look at in future is whether the yearly opt-in is the right time frame,” Brockman told the Senate.
“To me, one year is not a magical number. Perhaps two years is a more regulatory-friendly period to look at in the future. As a chamber, as a parliament, I would like us to keep thinking about these things. We need to create an environment where we allow Australians—Australian families, Australian businesses—to access high-quality and affordable financial advice."