Last week, we discussed some of the comments made by ASIC chair Joe Longo during a parliamentary committee hearing.
While that hearing gave Longo the opportunity to outline his interpretation of Josh Frydenberg's Statement of Expectations and ASIC's refreshed agenda, the main topic of discussion was capital concentration in Australia. And although much of the hearing focused on capital concentration with respect to the trajectory of holdings in the superannuation sector, a recent submission from the Stockbrokers and Financial Advisers Association (SAFAA) suggests a different target: FASEA.
In the submission, SAFAA CEO Judith Fox said: "Investment by Australian superannuation funds is not the problem in relation to the capacity of ordinary Australians to invest in the listed equities market. The problem is the regulatory framework governing access to investment advice and capital raisings, which needs to be reformed."
Fox argued that because "access to good-quality investment advice" is becoming unavailable to many Australians, retail investors "will increasingly be left with the choice of either DIY trading online with no advice or advice from a financial planner who has minimal direct expertise in listed investments and markets."
And the reason for this? A policy framework that refuses to acknowledge and accommodate for the different types of financial advice in the market.
Fox explained: "The increased and unhelpful regulatory burden on the provision of financial advice is a consequence of government policy and legislation. SAFAA has long advocated for Government and ASIC to revisit the regulatory settings around the provision of advice to retail clients and to move away from a ‘one-size-fits-all’ approach.
"FASEA’s lack of understanding about what stockbrokers and investment advisers do and importantly, how that differs from financial planning, has led to a ‘one-size-fits-all’ approach to financial advice that ultimately disenfranchises retail investors."
Because FASEA treats all advisers as financial planners, Fox added, "notwithstanding the differences between the financial planning advice model where advice is provided on all aspects of a client’s financial circumstances and stockbrokers and investment advisers who provide scaled advice on a client’s investments and shares. They are different forms of advice serving different client needs."
The opinions expressed in this content are those of the author shown, and do not necessarily represent those of No More Practice Education Pty Ltd or its related entities. All content is intended for a professional financial adviser audience only and does not constitute financial advice. To view our full terms and conditions, click here
A set of recommendations in a new policy paper from the FSC will cut the....
The advice industry has experienced a precipitous decline in representat....
20 October, 2021
A set of recommendations in a new policy paper from the FSC will cut the per-client cost of service by 37%, according to KPMG analysis. Do the numb....
20 October, 2021
The advice industry has experienced a precipitous decline in representatives since the introduction of FASEA, but new research suggests there's one....
13 October, 2021
According to a new piece of research from the FPA, many Australians still don't see the value of advice, with nearly half (41%) of participants exp....