Phil Anderson
The announcement of another sizeable CSLR cost of $190 million in 2026/27, and the prospect of sizeable special levies for the foreseeable future, is an unsustainable burden for financial advice practices and their clients, while offering little comfort to the victims of financial collapses.
We support the principle of compensation and accountability where misconduct occurs. However, a fair scheme must not undermine the ongoing viability of the advice profession at a time when more Australians than ever are seeking professional advice to help navigate life’s hurdles, including recent major Budget tax changes as well as aged care and NDIS changes.
We urge the Government to cap the total CSLR levy (annual plus special levy) so that financial advisers pay no more than $20 million until we have a sustained increase in adviser numbers. This will ensure Australians do not miss out on the advice they need.
The financial advice profession is made up primarily of small and micro businesses, with an average of only 2.5 advisers per practice. These small businesses have little ability to absorb additional significant costs, and the FAAA’s member survey in April this year shows many are considering leaving the profession and abandoning recruitment plans.
This survey of FAAA members found the CSLR special levy is set to significantly impact Australia’s financial advice landscape, with most respondents saying it will push up costs for clients, accelerate adviser exits and reduce recruitment. Nine out of ten advisers expect the levy to increase the cost of financial advice and 70 per cent of advisers believe the CSLR levy will result in a reduction in adviser numbers[1]. Whilst the CSLR special levy is labelled as a financial advice sector cost, the Shield and First Guardian collapses demonstrate that many sectors have contributed to the substantial client losses. The special levy must be shared broadly across financial services sectors.
The Albanese Government has shown admirable willingness to provide targeted support for essential industries that are facing significant headwinds. For example, in May 2026, it suspended the Commercial Broadcasting Tax for a further two years delivering $111.3 million in savings for the commercial broadcasting sector. We urge the Government to show a similar commitment to financial advisers.
By Phil Anderson, general manager policy, advocacy and standards
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