Amid informal consultation on the Quality of Advice Review, the Minister for Financial Services Stephen Jones has been questioned about the unpopular move to raise the ASIC levy on advice providers.
In a statement on Thursday afternoon, the Financial Advice Association said the recent Joint Associations Working Group QAR roadshow across Australia heard many questions about the fairness of the recently announced increase in the ASIC levy, a flat fee of $1500 per licence plus a graduated component of $3217 per adviser.
FAAA chief executive Sarah Abood said it doesn’t make sense for the per-adviser levy to triple at a time when adviser numbers have reduced significantly with the cost of advice continuing to go up.
“This issue was proactively raised by attendees at every event, and the minister has now heard the concerns very clearly directly from those most affected,” Abood said.
“We continue to engage intensively on this matter, as we believe that even under the current Industry Funding Model (IFM) – which we know has flaws – there could be ASIC costs that have been incorrectly attributed to our sector.”
The former Coalition government froze the ASIC levy in August 2021 after the regulator had earlier projected a steep increase.
The levy freeze was re-assessed as part of Treasury’s review into the IFM which ultimately recommended ending it.
The association’s argument comes as Iress and Business Health research shows advice practices are largely profitable, which will likely handicap any argument being made to Treasury or the minister.
The levy will ultimately be passed onto an average of 129 clients per adviser (based on the above research), further giving the government more of an incentive to push the advice industry to take on a larger client load if many of the .
The FAAA hosted several events with fellow JAWG members across Brisbane, Townsville and Cairns this week.
It followed an earlier event in Hobart towards the end of June where the minister heard adviser concerns about the boundaries and standards for expanded intrafund advice access.
“Overall, attendees have told us they’ve found these events to be extremely valuable as an opportunity to engage directly with the minister,” Abood said.
