AFA points to ‘irony’ of ISA scaled advice position

Commenting on the Senate Economic Legislation Committee’s FOFA report, Mr Fox said there were “few surprises” though views expressed by opponents of the Bill during the consultation – reflected on in the report – were “contentious”.

“It is most surprising to see the one sector of the industry that will operate primarily on the basis of intra-fund advice come out opposing changes to improve access to scaled advice,” he said.

“The discussion about the risks of the adviser scaling the product options to one provider is ironic given that intra-fund advice is limited to advice on the member’s holding in their existing superannuation fund.

“These opponents need to either support both scaled advice and intra-fund advice, or oppose both. Consumers cannot be expected to cope with two different sets of advice rules for what appears to them as the same scenario.”

In addition, Mr Fox rejected the suggestion – as put forward by Greens Senator Peter Whish-Wilson – that an amended FOFA would only benefit the major financial institutions.

“While some are licensed by an institution, they are certainly not controlled by that institution,” Mr Fox said. “In this entire debate, we need to reflect upon the fact that in Australia the majority of financial advice is provided by small practices within the local community or country town and as such represent a small business activity.”