THE Financial Services Council (FSC) has issued Affordable and Accessible advice: FSC Green Paper on financial advice, to lead the public policy debate on a restructure of financial advice.

FSC CEO Sally Loane said, “The financial advice industry is facing significant challenges, with rising regulatory requirements and cost pressures undermining the economics of the sector. The burden of compliance is doing nothing to help consumers, it’s actually putting advice beyond the means of average Australians, and driving advisers out of the sector.

“Our aim with these proposals is to lower the cost of providing financial advice to make it simpler for consumers to understand and access, all without undermining the quality of advice or eroding important consumer protections,” Ms Loane said.

The FSC supports the Best Interests Duty remaining the bedrock of the advice sector and for advisers to be held to a high standard of education and subject to a Code of Ethics. There are significant opportunities, however, to reduce the cost and complexity of providing financial advice.

The proposals in the FSC Green Paper which has been developed with the FSC’s advice licensee members, are bold and canvass fundamental changes to the legislative and regulatory framework, including:

• Abolishing the ‘safe harbour’ steps used to comply with the Best Interests Duty, which are administratively complex;
• Removing jargonistic advice categories that confuse consumers by simply breaking all advice into either general information or personal advice, and regulating them consistently; and
• Abolishing costly and unwieldy Statements of Advice, and replacing them with Letters of Advice, which would be short, concise and consumer orientated.

The FSC’s Green Paper is underpinned by independent research from RiceWarner and consumer testing, by research agency Pollinate whose research shows that almost two in three Australians support simplifying financial advice and reducing its cost, provided consumers are adequately protected by law.

“The FSC is seeking industry and public feedback for our proposals in advance of finalising a policy position on a more accessible and affordable financial advice system which we will publish in a White Paper later this year,” Ms Loane said.

“We are keen to hear from a wide range of stakeholders, particularly advisers. As leaders in policy development, we have a great opportunity to re-set the system for affordable, quality and professional financial advice, a critical component in enhancing the savings, wealth and peace of mind for every Australian.”

“The status quo will mean advice will consolidate in the wealthy elite, and will remain out of reach for the average consumer.”

Consultation on this Green Paper is open until July 1, 2021 and submissions can be sent to This email address is being protected from spambots. You need JavaScript enabled to view it..

A full copy of the Affordable and Accessible advice: FSC Green Paper on financial advice can be found at: https://fsc.org.au/resources/2181-affordable-and-accessible-advice-fsc-green-paper-on-financial-advice/file

About the Financial Services Council

The Financial Services Council (FSC) has more than 100 members representing Australia's retail and wholesale funds management businesses, superannuation funds, life insurers, financial advisory networks and licensed trustee companies. The industry is responsible for investing almost $3 trillion on behalf of more than 15.6 million Australians. The pool of funds under management is larger than Australia’s GDP and the capitalisation of the Australian Securities Exchange and is the fourth largest pool of managed funds in the world.

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THOUSANDS of people can now be sure that they will receive HomeBuilder grants with the Federal Government’s extension of the construction start date.

Master Builders Australia ceo Denita Wawn said, “The scale of the HomeBuilder success - more than 120,000 HomeBuilder applications have created huge pressure on the supply chain with Master Builders Australia’s survey of the industry showing that 70 percent of builders are being hit by delays and cost increases for key trades and building products.

“This also created the risk that thousands of HomeBuilder applicants could miss out on the grants because builders could not meet the construction start date requirements.

“Thanks to this move by the Federal Government, thousands of HomeBuilder applicants around the country can now breathe a huge sigh of relief,” Ms Wawn said.

“This will help builders and tradies maximise and manage the extraordinary success of HomeBuilder.  

“The Federal Government showed strong leadership to introduce HomeBuilder when Covid lockdowns meant thousands of builders and tradies faced a valley of death with no forward work,” Ms Wawn said.

“Thanks to HomeBuilder those businesses and jobs were saved. It’s been one of the most effective government interventions ever."

www.masterbuilders.com.au

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YESTERDAY the House Select Committee on Mental Health and Suicide Prevention released its interim report.

The committee’s interim report includes an update on the committee’s activities to date, and emerging themes identified through recent reports into Australia’s mental health system and engagement with the Productivity Commission, National Mental Health Commission and Department of Health.

Chair of the committee,Fiona Martin MP, said, "The interim report provides a snapshot of the breadth of work underway on mental health and suicide prevention. It also identifies some areas that the committee feels need further examination as the inquiry progresses.

"These areas include the divide between public and private mental healthcare, coordination and funding of mental health services, affordability, the growth of telehealth and digital services in response to COVID-19, and the role of professional bodies in advocating for, regulating and supporting the workforce."

Moving into the second phase of the inquiry, the committee will hold a series of public hearings with a range of organisations, from public and private mental health service providers to organisations representing consumers and carers, professional and peak bodies, and researchers.

The dates and locations of public hearings will be published on the inquiry website.

The interim report can be accessed on the committee’s website.

The final report of the committee is due to be presented by November 1, 2021.

The committee is unable to intervene or provide advice in relation to individual circumstances. 

Lifeline Australia 13 11 14
Suicide Call Back 1300 659 467
Kids Help Line 1800 551 800
BeyondBlue 1300 224 636
eheadspace 1800 650 890

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WITH THE AUSTRALIAN comeback underway, executives from Australia’s four major banks will appear before the House Economics Committee at public hearings on Thursday and Friday this week to discuss their response to the pandemic, the direction of the housing market, small business lending, and their progress implementing the Hayne Royal Commission recommendations.

Chair of the House of Representatives Economics Committee, Tim Wilson MP, said, "With the phasing out of taxpayer-funded COVID-19 support and mortgage deferrals, we are keen to hear what the initial data is showing on the recovery of the economy and household balance sheets.

"Surging property prices, fuelled by historically low interest rates, have left many Australian first home buyers high and dry. Many young families are forced to save larger deposits while also paying increasingly higher rents. The committee will discuss the role of banks in empowering hard-working Australians to purchase property and invest in their future," Mr Wilson said.

The hearings will also examine the four major banks’ progress in implementing the recommendations of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry.

"It is disappointing that compliance issues regarding unconscionable conduct and misrepresentations over fees continue to come to light," Mr Wilson said. "These behaviours erode the community’s trust in financial institutions.

"These hearings give the committee an opportunity to follow up on how they can be prevented in the future so that the industry can regain the community’s trust," Mr Wilson said.

For more information about the hearings, or to read transcripts from previous hearings, you can visit the committee’s website.

Public hearing details

Date: Thursday, 15 April 2021
Time: 9.15am to 4.15pm
Witnesses: CBA, Westpac

Date: Friday, 16 April 2021
Time: 9.15am to 4.15pm
Witnesses: NAB, ANZ

Due to health and safety concerns relating to the COVID-19 pandemic, this hearing is not currently scheduled to be open for public attendance. Interested members of the public will be able to view proceedings via the live webcast at aph.gov.au/live.

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