Keep up the political lobbying: Klipin
Now is no time for advisers to ease up in terms of lobbying local members of parliament (MPs) around Future of Financial Advice (FOFA) issues, according to Association of Financial Advisers (AFA) chief executive Richard Klipin (pictured).
In a speech to the national AFA roadshow yesterday, Klipin was again critical of two key elements of FOFA: opt-in provisions, and the banning of risk commissions within superannuation.
Klipin said an alternative to opt-in could be strengthening opt-out provisions and making those easier for consumers to understand, rather than opt-in, which he said would drive up costs.
Opt-in could drive up costs by around $100 per client between adviser time and staff preparation time as well as increased costs from product providers, he said.
Klipin also questioned why you would set up a payment system for insurance where you can get essentially the same product inside or outside a tax structure where one way the adviser gets paid and one way they don’t, unless it was a political decision or designed to drive consumers into industry super funds.
The AFA has now shifted from policy to politics, he said, and now is the time for advisers to continue going to see their local politicians and speak to them, Klipin said.
They may toe the party line in person but if they all go back to the party room and relay that they are getting angst from their constituents then this will still influence the FOFA debate, Klipin said.
The AFA has a FOFA pack that will outline to advisers how they go about contacting their local member as well as other relevant information, he said.
“We’re in the third quarter, this is not the time to drop the ball and think that any debate is now over,” he said.
“We’re expecting draft regulation sometime in August. Once we get the draft regulations then we’ll get a sense of how successful we’ve been as a profession in arguing the toss – and then it’s our right to continue arguing,” he said.
“We’ll see how it plays out but there’s still a whole lot to play for.”
Recommended for you
ASIC has cancelled a Sydney AFSL for failing to pay a $64,000 AFCA determination related to inappropriate advice, which then had to be paid by the CSLR.
A former Brisbane financial adviser has been charged with 26 counts of dishonest conduct regarding a failure to disclose he would receive substantial commission payments for investments.
Inefficient data processes and systems mean advisers are spending over half of their time on product implementation and administration at the expense of clients, according to research.
With the regulator announcing its enforcement focus for 2025 last week, law firm Hall & Wilcox examines the areas which have dropped down the list in priority for the regulator.
