Financial Planning

Govt determined to reduce advice impediments

financial advice barrier

The reduction in red tape that is hindering the ability to deliver affordable financial advice to more Australians is a priority for the federal government.

The federal government has confirmed it is committed to reducing administrative and operational barriers to allow financial advice to be provided to more Australians more easily.

During her address at the recent Association of Financial Advisers national conference, Vision 2020, Assistant Minister for Superannuation, Financial Services and Financial Technology Jane Hume told delegates this goal remained a focus for the government in light of the critical role it has acknowledged financial advice will play in the nation’s economic recovery from the coronavirus-induced recession.

“I am constantly looking for opportunities for red tape reduction, identifying obstacles to productivity and profitability, and reducing the burdens on your industry and its participants,” Hume said.

“And it’s not just because you’re noisy. Working to make your life easier actually makes our life easier.

“Financial advisers are a critical part of our economy and will be critical in our COVID recovery.

“I’m not afraid to say that the government has a vested interest in ensuring that you can provide financial advice to as many Australians as possible without being tied up in red tape.”

To this end, she identified the use of technology and the attitude regulators have towards automated tools as key ingredients in achieving this aim.

“What we’ve asked the regulators, particularly ASIC (Australian Securities and Investments Commission), to think about is looking at approving, rather than the plan at the end of the advice process, the algorithms within the technology that you use,” she noted.

“The problem with robo-advice is [it means different things to different people]. Robo-advice to some extent is the technology you’re already using, but we’d like some of that to be compliant by the time it spits out the first iteration.

“[So] the value that you add on top of that is what could potentially be audited as opposed to the grunt work behind [the scenes].

“I think that will make an enormous difference to the way you approach your clients, your workload and what you’re concentrating on.

“I think that’s a terrific opportunity and also it can potentially condense and automate some of the approvals and consents you have to go through with your clients, and we know how onerous they are.”

Hume had earlier revealed she is very optimistic about the future of the financial advice sector.

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