Advisers should be paid like doctors: ISA
Industry Super Australia (ISA) has reiterated its calls for advisers to move with haste to a fee-for-service model, with all commission-based fees banned, including on life insurance.
It also argued the welfare of the consumers relies on greater regulatory funding.
In a submission to the Senate Economic Committee's inquiry into the Scrutiny of Financial Advice, ISA said advisers should operate on the same fee model as doctors, with stressing fixed fees would remove advisers' "reliance on incentives or commissions" and "provide consumers with greater transparency in relation to fees and the value of the advice".
It also stressed the banning of all forms of conflicted remuneration is key to advisers' professionalism, as is a raised educational benchmark, comprising of a relevant tertiary degree and further specialist training.
Beyond advice changes, ISA said increased regulatory powers were necessary to ensure fairness and adequate consumer protection.
It said the Australian Securities and Investments Commission (ASIC) should be given more funding to police the licensing system in relation to compensation and develop codes of conduct.
Recommended for you
Sequoia Financial Group has declined by five financial advisers in the past week, four of whom have opened up a new AFSL, according to Wealth Data.
Insignia Financial chief executive Scott Hartley has detailed whether the firm will be selecting an exclusive bidder for the second phase of due diligence as it awaits revised bids from three private equity players.
Insignia Financial has reported a statutory net loss after tax of $17 million in its first half results, although the firm has noted cost optimisation means this is an improvement from a $50 million loss last year.
With alternative funds being described as “impossible” for fund managers to target towards advisers without the support of BDMs for education, Money Management explores the evolving nature of the distribution role.
