QAR response plaguing advisers’ minds
The government's response to the Quality of Advice Review (QAR) has been ranked as the number one issue discussed among financial advisers.
The What Advisers Want report, conducted by digital advice platform Ensombl, surveyed its 5,600 adviser users and highlighted the 15 topics advisers engaged with most this year so far.
Ensombl identified the government’s long-awaited formal response to the QAR as the top conversation between advisers on its platform.
Issued on 13 June 2023, the response accepted 14 of the 22 recommendations made by Michelle Levy in her final report in February.
The first stream of the QAR reforms proposed by the government covers “removing regulatory red tape that adds to the cost of advice without benefiting consumers”.
No draft legislation has been announced yet, with Minister for Financial Services, Stephen Jones, describing it as being “only weeks away” back in September.
Ensombl’s report emphasised what advisers want regarding this topic, including more periods of stability with less reviews and speedy implementation of changes.
Moreover, the platform revealed advisers look forward to industry-standardised templates that will replace statements of advice (SOA) and a level playing field when super funds begin providing advice.
In addition, the 14 other key issues discussed by advisers included:
- Technology.
- Investments.
- Life insurance.
- Pricing advice and fee methodologies.
- HR and recruitment.
- Outsourcing.
- Superannuation.
- Retirement and aged care advice.
- Client service and experience.
- Estate planning and intergenerational wealth transfer.
- Australian Financial Complaints Authority (AFCA) determinations.
- Client retention strategies.
- Client communication, including newsletters and videos.
- Document and template sharing.
Aside from QAR discussion, technology consistently produced the highest engagement and questions in the advice community.
The move away from large institutional licensees to sole practitioners and boutique firms has meant advisers have been further involved in selecting technology, the research found.
Clayton Daniel, Ensombl chief executive, explained the report provides valuable insights for both advisers and providers by identifying common industry challenges.
“Advisers come to the platform to solve their own business challenges by connecting and collaborating with their professional peers. This report provides a fascinating snapshot of the issues most topical for advisers during the first half of 2023,” he said.
“While many of the topics are evergreen, many conversations have picked up in response to current market challenges. Interest in investment philosophies, for example, has undoubtedly spiked in response to the continuing investment market turmoil. Many of the outsourcing and technology questions are undoubtedly driven by an increased focus on efficiency.”
AUTHOR
Jasmine Siljic
Recommended for you
Following an extraordinary general meeting today, Dixon Advisory parent company E&P Financial Group’s shareholders have voted on its proposed delisting from the ASX.
While overall financial adviser numbers have dipped below 15,500 this week, Rhombus Advisory is experiencing growth and approaching 500 advisers in its ranks.
Iress’ Xplan continues to dominate the financial planning software market with a multitude of uses, according to Netwealth research, despite newer players battling for a piece of the pie.
ASIC has shared the percentage of breach reports related to financial advice in FY24, noting increased reporting by smaller AFSLs.
When I wrote my submission for the QAR review, I discussed the Industry Funding Levy on financial advisers that was the primary cause of advisor industry numbers dropping from around 28,000 in 2018 to less than 16,000 in 2023. ASIC investigation and enforcement costs increased from $23 million to $55 million in 2022-23 to be levied to financial advisors. For my 2 AFSLs, we are expecting ASIC levy Invoices for $51,255. Senator Bragg (Chair of Senate Economics References Committee Hearing on 4 October) asked, "What benefit do we get from the levy?" I replied, "Nothing". When the ASIC $55 million Invoices in levies be issued soon, how many advisers will depart the industry and how many will remain to implement QAR? Why do research organisations look at each matter in isolation, when both are dynamically directly bonded affecting industry effectiveness and efficiency?
In the Senate Hearing, in reply to another Senator's question, my reply was: "I apologise for using Australian slang, it is in my submission: 'If your Police car runs over a dog, why should we have to pay for the dog?'" I apologise to dogs because they did not cause this political levy impost.
Well stated Ross. These clowns running the government should be more strongly held to account and sacked when they are not doing the job properly for which they are paid. They are not some damn deity to be adored or looked up to - they are servants of the public - their employers - with a specific job to do in a timely fashion. Like all other employees, if they can't do the job when they are supposed to have it done by then they must go. No waiting for so-called 'elections'. P.S. That they're in a position to grant themselves pay rises simply boggles my mind; what a laughing insult to all Australians!