The SMSF Association has welcomed the Financial Services Council’s (FSC) ‘White Paper on Financial Advice’, saying it aligns with its goals of modernising financial advice and enhancing the professionalisation of the advice sector.
The association deputy chief executive and director of policy and education, Peter Burgess, said the white paper, which was underpinned by analysis by KPMG, reflected what the association said in its submission to the Australian Securities and Investments Commission (ASIC) for the Consultation Paper 322 (CP 332).
“In that submission we noted feedback from our members that the advice process is lengthy and costly,” Burges said.
“Our priority is for reform that reduces complexity, improves efficiency and drives harmonisation to better enable the provision of affordable, accessible and quality advice to small businesses and consumers.
“So, a white paper that proposes reforms that will benefit clients and advisers, deliver cost savings and practical, relevant advice that consumers will understand and engage with gets our full support.
In particular, Burgess noted the FSC had called for the need to restrict specialised advice to those who were authorised to provide that advice, and that this necessary reform should be enforced through standards.
“The importance of education and specialisation are key components of the association’s core beliefs, and we endorse measures that seek to improve standards and recognise the need for specialisation,” Burgess said.
“In our ASIC submission we said that advisers who provide advice to individuals about SMSFs should have specific SMSF education and qualifications that underpin their advice. The Productivity Commission in their final report ‘Superannuation: Assessing Efficiency and Competitiveness’ recommended that SMSF advisers should have a form of specialised qualification to provide SMSF advice.
“This was also supported in ASIC’s Report 575 where the regulator suggested that SMSF advice would be improved by raising education standards with a specific SMSF qualification for advice providers wishing to provide SMSF advice.”
Burgess said the FSC’s assertion that the “financial advice industry has reached an important milestone – it has become a profession” should be a clarion call for the industry to call for the modernisation of the complex and costly regulatory framework it is enmeshed in.
“This is where the KPMG analysis is so pertinent, highlighting why the changes the industry is advocating for will reduce the cost of advice and open it up to more consumers,” he said.