Provide certainty and clarity around the Code of Ethics to ensure that it allows scalable, affordable advice to be provided to clients in a professional manner
This is subject to fixing problems with the Code, specifically Standards 3 (Better providing for conflicts of interest/duty), 6 (certainty with scaled advice) and 7 (clarifying the meaning of value for money)
Recommendations:
Remove duplication across the BID, through rationalisation of existing obligations
Advocate for the QAR recommendation to repeal ‘safe harbour’
Better enable the application of professional judgement as opposed to prescriptive rules
Recommendations:
Separation of disclosure information and the actual advice
Create advice documentation that is less about satisfying the requirements of regulators and licensees.
Client records should be a distinct category separate from what is given to the client.
Recommendations:
Tax deductibility of all financial advice
Reduce ASIC Funding Levy
Reduce PI Insurance cost
Reduce cost of preparation of advice documents
Reduce business overheads, such as through the rationalisation of breach reporting
Address wholesale client thresholds and consent requirements
Tighten the personal advice test to capture more of what is now general advice
Application of CSLR to cover all AFCA members
Implement the ALRC recommendations on the Corps Act
Advocate for the QAR recommendation for a single client consent and the removal of fee disclosure statements
Simplify the provisions of FSG
Recommendations:
Review LIF caps to ensure commercially viability of life risk advice
This must include covering the cost to service
This should be done with a view to better coverage of a broad-range of consumer types
Recommendations:
The following areas should be seen as stepping stones on the way to the achievement of the above objective.
Ownership of client clarification
The removal of restrictions of trade - Planners should be able to work under any business structure
CSLR/ASIC levy calculations would need to change to mirror this new model
Provide greater certainty to ensure that advisers are not held responsible for product failings and risk
Alternative PI offerings would need to be explored
Removal of any future impediments to individual registration
Recommendations:
FAAA should ensure the profession owns the management of:
Education standards and professional training,
the Code of Ethics, and
the disciplinary regime
in a progressive manner in the years to 2030, so that financial advice becomes a fully self regulatory profession.
We recognise that this will take the form of co-regulation in the initial phases.
Recommendations:
Better recognition of advice specialisations
Improved training pathways and funding support for new entrants
Increase recognition of prior learning and experience
Reduce minimum CPD hours for professionalism and ethics
Recommendations:
Increased awareness by all government, bureaucratic and political stakeholders about the value of advice and FAAA’s role in its advocacy
This should be done in conjunction with FAAA playing a more active role in demonstrating to consumers the importance of advice.
Promote a better understanding of what financial advice is.
Recommendations:
More work should be done on student flexibility in regards to approved courses, recognition of prior learning and support of specialisations within financial advice
Greater encouragement for Group of Eight universities to offer financial advice education and better pathways for graduates from these universities to become financial advisers
Recommendations:
Holistic, consumer-facing advice provider register to replace the FAR and be technology neutral: a one-stop registry of who has given advice, on behalf of whom
Cyber-security and data protection guidelines should be tailored to small businesses such as advice practices (modelled on the ASIC financial advice hub but for cyber security)
Recommendations:
This should include refinements to and better integration of Digital ID, AML/CTF, CDR and client consents.
Standardise data collection authorities
The creation of universal financial services data standard
Recommendations:
This should include:
ATO portal
Increased Centrelink access
Digital ID
Recommendations:
This should include:
Digital advice
AI-assisted consumer interfaces
The flexibility to allow different types of providers
Regulatory flexibility to encourage innovation
Using technology to speed up efficiency dividends of the advice process.
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