General advice provides an important entry point for Australians who can’t necessarily afford personal financial advice, according to John Flavell, executive general manager of wealth advice for National Australia Bank.
Asked about his views on the payment of commissions for general advice, Flavell says that “in terms of how we reward our people…part of the solution [to the retirement savings gap] is to enable the distribution of general advice”.
“And you’ve got to be able to remunerate [advisers] to do that,” he says.
“At the end of the day, there is a large part of the Australian population that can’t afford to pay for personal financial advice. Missing out on that [access to general advice] would be to the detriment of the consumer.”
Asked for his views on the general advice terminology employed used in the Corporations Act, Flavell concedes that perhaps clearer wording could be used to minimise confusion among consumers.
“It’s easy to get caught up in the terminology, though maybe there is a more appropriate term,” he says. “The main thing is that there has to be a mechanism where people can get their wealth needs met.”
Flavell also believes the ongoing consultation on the Future of Financial Advice (FoFA) reforms is necessary.
“It’s healthy that we have the debate,” he says.
“Although the process has been stop-start, we feel it’s appropriate that some of the FoFA provisions should be reviewed…you make the regulatory changes to deliver a specific benefit to the consumer.
“We think the provision of advice is a big part of closing the gap [in retirement savings].”
Flavell says the regulatory reforms will add to the level of professionalism with which Australia’s financial planners are viewed
“FoFA will add to that, but not on its own,” he says.
Asked about trends in MLC’s financial planner network, Flavell says the industry has “something of a fascination with adviser numbers – it’s not about the numbers. It’s about having a highly skilled, quality team”.
“We focus on the quality of our clients’ outcomes, everything we do is about that,” he says.
“We continue to improve the ability for our advisers to service their clients.”
