PIS warns of unlevel playing field post-FOFA
The financial planning industry needs to be just as pragmatic about its underlying economics as it is about its pursuit of becoming a profession, according to the managing director of Professional Investment Services (PIS), Grahame Evans (pictured).
Evans said the economics of the industry had developed to create a situation in which those who had more subsidised those who had less.
“Whilst the idealism of a profession is certainly a very worthy goal, we must consider the impacts to the availability, cost and quality of advice,” he said.
“This is not a cliff face exercise, it is a journey and as such we need to transition the industry in a way that does not destroy but ensures a level playing field,” Evans said. “The last thing we would want is to go back to a quasi-tied agency structure.” However, he said that with consolidation occurring within the financial planning industry, there was a genuine possibility that the tied-agency structure would make a return.
Evans said PIS was extremely concerned about the boutique licensees that did not have the scale to vertically integrate.
“If I was a boutique I would be pressing the Government for some form of compensation in similar fashion to the dairy and fishing industries,” he said. “It is evident to most that the value of the boutique licensees’ business will fall as a result of these changes.”
AUTHOR
Mike Taylor
Recommended for you
The Governance Institute has said ASIC’s governance arrangements are no longer “fit for purpose” in a time when financial markets are quickly innovating and cyber crime becomes a threat.
Compliance professionals working in financial services are facing burnout risk as higher workloads, coupled with the ever-changing regulation, place notable strain on staff.
The Senate economics legislation committee has recommended Schedule 1 of the Delivering Better Financial Outcomes legislation be passed as it is a “faithful implementation” of the recommendations.
Treasurer Jim Chalmers has handed down his third budget, outlining the government’s macroeconomic forecasts and changes to superannuation.
