Advisers need room to move on regulations, superannuation: SMSF Association

The SMSF Association said that the “desired policy outcomes” of limited licensing have not been achieved, creating burgeoning unmet financial needs, high regulatory costs, and leaving accountants and advisers “strangled by regulation”.

“We support the federal government’s stated ambition to grow the Australian economy out of debt in the wake of the COVID-19 induced recession – and cutting the red tape that is stifling the financial advice sector for consumers and advisers should be integral to this goal,” said SMSF Association CEO John Maroney.

“We believe it is imperative for the government to commit to a review of the financial advice framework so more consumers can seek affordable advice as the economy improves and so unmet SMSF advice needs can be met.”

The association said the government should remove the need for multiple licenses, registrations, and regulators and their associated levies to reduce the cost of providing strategic financial advice. It also wants to see the creation of a revised framework that would see individual registration of advisers with a single body; a single education framework for induvial advisers; a ‘harmonised’ Code of Ethics; and appropriate consumer protection, including access to dispute resolution.

“An individual who seeks superannuation and retirement advice, whether it be from a financial adviser, accountant or superannuation trustee, should receive high quality and affordable advice with the same meaningful disclosure,” Mr Maroney said. “In our opinion, therefore, providing a new overarching regulatory framework for superannuation financial advice is key to this process.”

The SMSF Association also wants to see the ATO give financial advisers access to the superannuation tax portal in order to address the “fundamental lack of information for SMSF advisers who need to provide timely advice”.

“We believe finding a solution to the issue about how SMSF and superannuation advice and services fit into the financial advice regulatory framework for accountants, financial advisers and superannuation trustees is an important and necessary first step,” Mr Maroney said.

Only registered tax agents (usually accountants) are able to access the ATO portal to obtain information like total superannuation balance (TSB) and transfer balance cap (TBC) – but these agents often aren’t able to provide SMSF advice as they aren’t licensed or authorised with ASIC.

“Accountants are able to obtain information but cannot provide advice and financial advisers are unable to obtain information but are the advisers authorised to provide advice,” the SMSF Association said in its 2020-21 budget submission. “This jeopardises the quality and efficiency of advice that is being provided to members.”