Quality of Advice Review (QAR) chair Michelle Levy has confirmed her final report was not about keeping people happy, but instead focused on creating a framework where financial advice can be delivered in an affordable and accessible way.
During a panel session about the future direction of financial advice at the SMSF Association National Conference 2023 held in Melbourne last week, Levy told delegates: “My recommendations are driven by consumer needs and rest on a strong foundation of law that protects consumers. The reforms proposed will not open the door to the poor and harmful advice practices which led to the Hayne royal commission. Rather, they will lead to more consumers having access to personal advice that meets their needs – that is, good advice.”
Fellow panellist SMSF Association chief executive John Maroney admitted he did not agree with every aspect of the QAR final report, but still thought it was a once-in-a-lifetime chance to put in place an improved regulatory structure for financial advice that will produce better consumer outcomes.
“Although the association has some reservations about the report and, in particular, the pressing need for accountants to be included in the broader church of advice that the review is advocating, we believe it has the potential to be a critical building block to a more professional advice industry,” Maroney said.
Financial Planning Association of Australia chief executive Sarah Abood described the final report as one that establishes a blueprint for the future of the financial advice industry, in particular by eliminating overly onerous and ineffective compliance procedures.
“For example, we see the recommendation to abolish statements of advice as a positive step. These documents can be 100 pages long and are not read by most consumers. Indeed, the review
offers an opportunity to cut a lot of unnecessary costs,” Abood said.
With regard to making the provision of advice cheaper for practitioners, AZ Next Generation Advisory chief executive Paul Barrett predicted the reforms, if implemented immediately, would increase the profitability of planning practices by 20 per cent.
