The Joint Association Working Group has penned an open letter backing the Quality of Advice Review reforms but has put an emphasis on getting quick wins for the industry.
Those quick wins, highlighted by the Minister for Financial Services Stephen Jones in March at the Conexus Financial Quality of Advice Review roadshow were simplifying the disclosure process including reducing Statements of Advice, as well as eliminating the safe harbour steps.
Noting Jones’ comments during the roadshow that taking a wholesale approach to the QAR proposals wouldn’t result in reforms happening any faster, the working group acknowledged the need to implement the proposals in stages.
“This will ensure immediate gains can be made, including substantially reducing the cost of accessing financial advice,” the letter said.
The working group is a coalition of associations and licensee groups founded last year to deliver a formal consensus on issues where there is overwhelming agreement.
Regarding the short-term fixes, JAWG’s letter identified the simplifying of disclosure statements – including standardised fee consent forms, repealing fee disclosure statements, simplified SOAs, and amending Design and Distribution Obligations reporting – as the top priority.
Additionally, it added replacing the current Best Interests Duty with a statutory BID that does not include the Safe Harbour Steps.
It also suggested the adoption of clearer member directed charging requirements for the provision of personal advice by super funds and tightening some of the exemptions on the ban on conflicted remuneration.
“These short-term reforms have the collective potential to reduce the cost of advice, making advice more scalable and more accessible,” the open letter said, which contrasts with the Minister’s belief that red tape reduction will do little to improve accessibility and affordability of advice.
Looking deep into the future