Lifespan welcomes key aspects of Quality of Advice Review, but urges caution
Eugene Ardino
Lifespan Financial Planning, one of Australia’s largest privately-owned financial advice networks, has welcomed key aspects of Michelle Levy’s Quality of Advice Review recommendations, and her bold approach, but says deeper scrutiny of proposed changes is needed.
Lifespan CEO Eugene Ardino said recommendations to significantly reduce regulatory complexity and duplication in the advice industry were positives, as were moves to improve access to personal advice for consumers.
“Under the QAR recommendations, anyone, including employees of banks, super funds and product providers who currently provides general advice to existing clients, would be deemed to be providing personal advice and so would be subject to a higher standard having to satisfy a ‘good advice’ test and show that the advice was fit for purpose and relevant to the client’s needs.”
“However, the risk and possible downside is that there will be scope for unqualified people to give personal advice. We’ll need to work through as to what standards and restrictions would apply to those who are not Relevant Providers and are able to provide personal advice under QAR recommendations,” he said.
Mr Ardino praised Ms Levy’s willingness to address some of the obstacles to advice delivery and problems with regulation head on.
“To make advice more accessible and affordable our compliance framework needs to be simpler. To achieve this there needs to be some radical changes – not just tinkering around the edges – and her proposals do just that. The question is, will those changes have the desired affect and what undesirable unintended consequences may they produce?”
“As government has already indicated there will be more consultation with stakeholders. We expect to see a great deal of lobbying from all stakeholder sectors as government grapples with the proposals and tries to work out what, how and when to implement.”
“The advice industry needs to really get its head around what is recommended, which is fundamental changes to cornerstone regulations. The industry needs to look at these from different and new angles with an open mind and while it may need time to do this it should be attended to as a priority.”
