The Australian Securities and Investments Commission (ASIC) has again been asked to make a judgement on whether politicians are breaching financial planning laws by making recommendations around the use of early release superannuation.
The Government’s hardship early release superannuation regime may have ended at midnight on 31 December, but Federal Opposition members are questioning whether social media comments by Victorian Liberal backbencher, Tim Wilson, represent a breach because they amount to the provision of unlicensed financial advice.
The Labor politicians have pointed to social media comments by Wilson in which he states: "Aiming to buy a first home and struggling to save the deposit? For 4 more days you may be able to access your super savings now to bring a purchase forward: earlier & cheaper. #HomeFirstSuperSecond - you’ll have a better life & a better retirement”.
The social media comment by Wilson immediately prompted Labor front-bencher and former shadow Treasurer, Chris Bown to state: “Mr Wilson is giving financial advice here. Unless he is a trained and licensed financial adviser he has some explaining to do”.
Bowen also pointed out that the “rules state early access is for hardship, not a house deposit. He has advised people to act in breach of the rules”.
The issue of politicians giving “advice” around early release superannuation has been referred to ASIC before, but it previously decided to investigate but not to act with respect to comments made by NSW Liberal Senator, Andrew Bragg.
Comments
Unlicensed advice is widespread and growing. ASIC's focus on persecuting licensed advisers while ignoring unlicensed advice has caused it to flourish. The only time they seem to take any interest in stopping unlicensed advice is when it is contrary to the vested interests of union funds.
More irresponsible behaviour from Wilson which while not surprising should be actively investigated by ASIC and the results publicly advised. Anything less is open to accusation of double standards and political bias.
Of course, if the Chairman of the House Economics Committee said the opposite & recommended putting additional contributions into the Industry Super Funds (which is advice], the IFS would welcome him with open arms & say zip. Spare me the hypocrisy.
Tim Wilson, Victorian Liberal backbencher and Chair of the Standing Committee on Economics probably went too far in late December when he mentioned that people could access their Super early to use the money for a home deposit. Does this mean it is government policy to keep super low and fiscally encourage people to buy a home? Probably. I certainly saw his comments in late December and immediately thought this is contrary to the rules of ‘Early Release’.
How about ASIC investigate unlicensed provision of mortgages to financial vulnerable aged pensioners???
Centrelink provide mortgage services and are not licensed to do so. Their staff provide advice on the mortgages and are also not trained or licensed. Last time I looked a loan with a mortgage over your property, charging a commercial interest rate was a product covered by the Corps Act..... So why do ASIC not police it??
Interesting what action the ASIC would have taken against a licensed adviser with the same message on a Social Media site actively advocating to cash in super under hardship to purchase property. I certainly do not agree at all with Mr Wilson's house first super second mantra which is essentially spend first and save what is left. If it wasnt for compulsory super Australian's Mr Wilson would not be able to make these comments as the people they are directed towards would have no super at all if the employer was not made to contribute. The only nest egg they have Mr Wilson wants them to spend for his election cycle.
It probably wasn’t the smartest thing to say but it was just his general opinion and not pretending to be a licenced advisor. When you apply for the early release there is likely to be a declaration asking what the funds will be used for a be if not for hardship the request would be denied. The onus is on the person to make the correct declaration on the application. No one is going to rush out and withdraw $10k on NYE because Wilson told them to. Storm in a teacup.
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