Watson softens stance on financial planners

Australian Liberal Party Senator John Watson has backed away from comments he made two weeks ago in which he said he hoped financial planners would one day become superfluous.

At the time, Watson said financial planning was one of the main weaknesses in Australia’s superannuation system and called for the role of financial planners to be reduced.

Addressing the Australian Superannuation Summit in Sydney last week, Watson, who also chairs the Senate Committee on Superannuation, said that while he had previously expressed the hope that there might come a time when mature Australians did not need a financial planner because they have enough knowledge to enter into products on their own, it was a “utopian statement”.

“It is like saying that one day you might be able to do without a doctor,” he said.

Watson said Australians will continue to need financial planning advice, just as they will continue to need doctors.

“The fact is that you never want to do anything all by yourself,” he said.

However, he repeated some of his earlier comments, stating the challenge was to ensure the calibre of financial planners matched that of other professionals in other industries.

Watson commended the efforts of theFinancial Planning Association(FPA) in this regard stating “The FPA is trying its best”, but he said the financial planning industry still has a way to go.

“We’ve got to get better quality financial planners and develop a centre of excellence. We need to develop a reputable profession which matches all other professions.”

While admitting that “in all professions there are bad eggs”, Watson said that in the financial planning industry, “standards must be a lot higher and education is the key”.