A year later: Unravelling the impact of Levy’s final QAR report

The final Quality of Advice Review (QAR) report was made public on 8 February last year, igniting a sequence of consultations and a roller-coaster of emotions that, to this day, lingers in anticipation of its grand finale.

Referring to the report as one “containing options”, Mr Jones said at the time: “We thank Michelle Levy for her work in leading this review and producing a detailed and valuable contribution.

“We want to see an industry with strong professional standards that’s accessible for more Australians and look forward to hearing views on achieving that goal.”

Of the 22 recommendations made by the review, to date, the minister has eliminated some entirely, sculpting others into mere echoes of their original intent.

The QAR’s most controversial recommendation proposed an expansion of advisory powers for institutions in order to bridge the existing advice gap and allow more Aussies to access advice, particularly as they approach retirement.

Despite advisers acclimating to the notion that their ranks may include superannuation fund employees capable of offering simple advice, the industry did not anticipate that the minister would extend similar privileges to banks and insurers, especially considering his previous opposition to the idea.

However, precisely 10 months after releasing Ms Levy’s report, Mr Jones delivered the government’s final response to the QAR and announced a new class of advisers would be added to the fray – the “qualified adviser”.

Many within the profession found this an odd label, given that the fight over advice qualifications has been a long and messy one, finally reaching some measure of conclusion following the royal commission, the Financial Adviser Standards and Ethics Authority (FASEA) exam, and a concerted effort at professionalisation.

In his speech at the time, Mr Jones explained: “Under our model, there will be a new class of financial advisers who will fill the advice gap by advising on less complex matters.

“It is expected that this new class – to be termed ‘qualified advisers’ – will generally be employees of licensed financial institutions.”

The profession has since received assurance that the term "qualified" was intended in a caveated or restricted sense. Nonetheless, acknowledging the dissatisfaction among advisers, the minister is expected to soon entertain suggestions for a more fitting term.

Overall, advisers are understandably tired of the QAR. Having essentially emerged as the unintended victims of the royal commission, advisers are tired of being under the scrutiny of the government and a minister that has so far done little towards fulfilling his promise to fix “the hot mess” that is advice.

Unfortunately, the QAR is not done yet. Instead, this year – with its new round of consultations, draft laws, and parliamentary debates – is going to be another year during which financial advice and its complex web of regulations will take the spotlight.

However, industry professionals are confident that this year will be the last of the QAR, with many anticipating legislation to wrap-up before the end of the year – in time for the next federal election, of course.