The SMSF Association has welcomed draft proposals from the Quality of Advice Review (QAR) to re-centre financial advice back to consumer outcomes and reduce the level of complexity currently involved in the provision of advice.
Association chief executive John Maroney said the QAR Proposal Paper released yesterday could be central to moving advice to focus on consumers and reflected many of the recommendations made by the industry body in its submission to the review.
“We have long argued for the need to recognise the professionalism of the sector, cut excessive red tape and put the consumer front and centre in the advice equation,” Maroney said.
“We have also stressed that how advice is provided to clients needs to be commensurate with the level of complexity and the number of issues to be addressed. Simple, single-issue pieces of advice should be able to be delivered through a simple letter of advice.”
He added the suggestion within the proposal paper to replace statements of advice (SOA) with advice documents that suit the needs of clients also reflected the association’s calls for certain types of advice to be provided in a simplified form.
“Currently, SOAs are risk management documents with a significant amount of their content compliance oriented. They have stopped being a consumer-centric document for the provision of financial advice and information,” he said.
Financial Services Council (FSC) chief executive Blake Briggs said the paper “outlines a sensible roadmap for delivering affordable and accessible financial advice by focusing on outcomes for consumers, not outdated compliance documents and red tape”.
“The review has listened to stakeholders and got the balance right by detailing a framework that allows consumers to get advice on the topics they need, with all the necessary consumer protections, and through a channel that suits them, rather than a one-size-fits-all model,” Briggs said.
“The financial advice industry can now have hope that policymakers are listening to their concerns and will embrace the opportunity offered through the proposals paper to open new affordable advice pathways for consumers.”
The views of the SMSF Association and FSC were also shared by the Joint Associations Working Group (JAWG), of which both organisations are members.
“The paper sets out proposals to make it easier for consumers to have meaningful, fit-for-purpose conversations with their advice provider about all or part of their financial and lifestyle objectives, while maintaining robust consumer protections – an objective the JAWG supports,” the joint group stated.
“We also take the opportunity to acknowledge the quality and depth of the engagement from the QAR team led by Michelle Levy, given the complexities and range of issues involved.”
The JAWG is made up of the following 12 organisations: Association of Financial Advisers, Boutique Financial Planning Principals Association, Chartered Accountants Australia and New Zealand, CPA Australia, Financial Planning Association, FSC, Financial Services Institute of Australasia, Institute of Public Accountants, Licensee Leadership Forum, SMSF Association, Stockbrokers and Investment Advisers Association and The Advisers Association.
