FPA submits financial advice competition recommendations to Productivity Commission


The Financial Planning Association of Australia (FPA) has submitted recommendations to the Productivity Commission’s inquiry into competition in the Australian financial system, designed to help enhance innovation, choice, efficiency and the quality of financial advice services for consumers.

The recommendations cover a number of areas relating to the unique financial advice market. These include issues with the regulatory environment, the disparities between advice and product businesses, and the current inconsistency of regulatory treatment across professions that hinder the price, service quality and innovation benefits of competition.

Commenting on the submission, Ben Marshan CFP®, Head of Policy and Government Relations at the FPA, said the issues impacting on competition in the financial advice market are unique and must be addressed to deliver the consumer benefits of competition in the financial advice market.

“Competition is essential to drive improvements in the quality and value of advice for consumers. These positive consumer outcomes can only be delivered by addressing the problems that impact financial planners’ ability to compete in in the financial advice market,” said Mr Marshan.

The FPA recommends the Productivity Commission consider issues that impact on competition in the advice market, separately to other financial services markets. These issues include:

“In our submission we highlight what the primary considerations should be when identifying the appropriate level of regulation versus the consumer benefits of competition. The wrong kind of regulation might see small licensee businesses become less price competitive than their counterparts who are aligned to large licensee businesses. There is a risk that small licensees will be priced out of the market and the number of advisers will fall as a result,” added Mr Marshan.