ASIC Chair James Shipton (right) with deputy chair Daniel Crennan

The corporate regulator has been asked to explain how it will ensure the proposed move to annual fee disclosure for advisers won’t result in needless double handling, with the member for Forde, Bert Van Manen, questioning the efficacy of arrangements embedded in the new opt-in provisions.

Questioning ASIC’s team of executives at the Parliamentary Joint Committee hearing on Corporations and Financial Services, Van Manen brought up the proposal that will require advisers to estimate, explain and disclose future annual client fees and then go through the same procedure looking backwards at the next period.

“How do we ensure… that disclosure is efficient and clear, and [it is] easy for consumers to understand what they’re getting and paying for, rather than what I see as a possible area of duplication?” the MP asked.

MP Bert Van Manen

ASIC chair James Shipton said he agreed with Van Manen’s “implicit suggestion” that the regulator needed to be wary of over-regulation in advice, and that organisation’s like ASIC “need to be held to account”.

Shipton argued, however, that the Hayne royal commission has “galvanised” an intense period of reform, and the financial system was going through a “catch-up period of investment to improve in good conduct”.

“We are aware that we need to – on an ongoing basis – monitor the effectiveness of any disclosure regime to make sure it’s working as efficiently as possible,” Shipton added.

Deputy chair Karen Chester, sitting to Shipton’s left, revealed ASIC is working with the government on its “ambitious deregulatory taskforce” to identify areas where they could apply “a lessening of regulation”.

“It’s really a matter for Treasury, but something we’ve been involved in,” Chester said, adding that “14 or 15 areas” of possible change had already been identified.

ASIC Deputy Chair Karen Chester

She also addressed the other major proposal on the annual opt-in Bill, which would require advisers to explicitly disclose their lack of independence to clients.

“Hayne couldn’t resist and had one disclosure recommendation – non-independence of fees in financial advice,” she said. “So we’re working with Treasury to make sure it’s done as efficiently as possible…”