Labor party senator Jenny McAllister has launched an extraordinary attack on financial advisers, refusing to back a bill seeking to extend SMSFs from four to six allowable members until a review is conducted into the “shonky” conduct of advisers and trustees.
Speaking in the senate this morning, McAllister repeated a line of concern from Super Consumers Australia questioning whether the proposal to broaden self-managed super funds will help “in an environment where barriers to accessing unconflicted financial advice persist”.
Conflicted advisers would be the real winners in any extension of the SMSF mandate, McAllister continued.
“The people who will benefit most from these arrangements are financial advisers giving shonky advice, the kind of advice we’ve seen again, and again, and again, the kind of advice exposed in the Hayne Royal Commission,” she said. “There are inadequate protections for consumers, and this bill exposes people further to these risks.”
McAllister, who is Labor’s shadow cabinet secretary, did not address the outsized role institutional providers – which have largely left the advice industry – played in the royal commission blood-letting.
The senator said the ALP is seeking a review of the bill’s operations within 12 months, including “consideration of the conduct of financial advisers and trustees, and the performance and governance of self-managed superannuation funds”.
No mention was made by McAllister of the advice review Treasury is already scheduled to conduct next year.
‘Unfortunate and disingenuous’
Responding to McAllister’s comments, the minister for financial services, superannuation and the digital economy, Jane Hume, defended the advice industry.
“I think it’s rather unfortunate and disingenuous of the opposition to disparage the good work that financial advisers do and the contribution that they make to the financial well-being of thousands and thousands of Australians,” Hume said at the hearing.
The minister highlighted the work the government has done to implement the recommendations made in the royal commission’s final report, including strengthening fee arrangements and disclosure requirements as well as committing to introduce legislation to establish the industry’s single disciplinary body by 30 June this year.
By blocking the bill, the ALP was reinforcing the perception that the party does not support consumers’ rights to manage their own money, Hume said.
“It’s not a complicated bill at all,” she said. “The increase in the maximum number of allowable members intends to provide additional consumer choice and flexibility to manage retirement savings, and that’s especially so for large families.”