Every so often you come across a story about a soldier from World War II who doesn’t know the war is over and is found living in a jungle somewhere, still fighting the battles of 50 years ago. The industry funds versus advisers war is a bit like that.

Industry funds never really were anti-adviser, nor anti-advice, per se. They were anti-commission and anti-conflicted remuneration. They were against advisers only to the extent that advisers’ remuneration was conflicted and influenced the “advice” they gave to industry fund members (that is, leave an industry fund and invest in a retail alternative that paid the adviser). But the war is over.

Garry Weaven, one of the principal architects of the industry fund sector, as much as called an end in June this year, at the Professional Planner Licensee Summit. Weaven said the abolition of conflicted remuneration from advice (in truth it’s not all gone, but we’ll let that ride for now) meant there was no longer any legitimate reason for industry funds not to embrace financial advisers.

Some funds have been slow to do that, despite the increasingly compelling evidence that advice is integral to delivering effective retirement income solutions. They still treat advisers badly, and their systems and data feeds are not adviser friendly.

However, some advisers have been slow too, even though industry funds have tens of millions of members who could benefit from advice as they move into retirement. But long memories and an aversion to perceived left-wing political influence over industry funds remain a potent mix.

Vanguard’s entry to the Australian superannuation industry last week shifts the ground considerably. Vanguard is, in effect, the advisers’ industry fund. It’s a low-cost, profit-to-member provider, offering many of the key benefits of industry funds, all wrapped up in an adviser-friendly bow – including a portal, which is likely to be a big step up compared to the clunky industry fund systems (and attitudes) advisers say they still routinely encounter.

Advisers who won’t engage with industry funds need to be able to explain clearly why it is in a client’s best interests to not recommend industry funds. There may be some legitimate reasons to avoid them, but not liking the politics isn’t one of them. You might get away with arguing that they’re difficult to deal with and their data doesn’t feed into Xplan effectively, but that sounds more like an objection based on an adviser’s interests than on a client’s.

Industry funds clearly appeal to a portion of the Australian population. Something like 1200 members join AustralianSuper every day, for example, and about half of those do so off their own bat, not because they’re compelled by an industrial award or by employer arrangements. That’s just one industry fund, though admittedly it’s the sector’s largest.

Industry fund sources reckon Vanguard could pick up market share of between 4 per cent and 8 per cent, which based on the current value of superannuation assets could amount to as much as $280 billion, and more as the market grows.

Vanguard will present a greater challenge to some industry funds than to others, especially those that rely on keeping costs low by using index fund management. Advisers, especially those with younger clients, who have been reluctant to deal with industry funds may have fewer objections to dealing with a player already established and proven in the adviser space.