Will the QAR actually achieve its goals?

The lofty goals of the QAR centred on making it easier for Australians to access financial advice and make it more affordable, all while maintaining the quality. Whether this is accomplished will not be known definitively for some, however, Bryan Ashenden, head of financial literacy and advocacy at BT, said the proposed reforms have largely met this standard.

Speaking at the SMSF Association national conference in Brisbane on Wednesday, Mr Ashenden said that, in general, the QAR has achieved its aims.

“I think an important thing out of the Quality of Advice Review, there were no significant call outs to say advice is not of a sufficient quality today,” he said.

“We’ve seen changes that have really helped, I think, from a quality of advice perspective.

“So, will these changes help to increase access to advice and make it more affordable? Well, the potential answer that is yes, they will.”

Importantly, he added, the changes to the financial advice landscape still need to go in tandem with “the right guardrails”.

“We need to make sure that they are implemented in the right way, that people who are going to provide personal advice have appropriate qualifications, whatever that level of qualification might be, that we have the right guardrails, the right safety around it to make sure that it’s quite clear about what type of advice different people can give, and that clients understand what that is,” Mr Ashenden explained.

The advisers, whether professional advisers or those in the proposed new class of advisers, also need to understand these limitations and help clients understand when they should make a move from these “qualified advisers” to a professional.

“That’s got to be seen as a positive if it means more people can seek advice, that’s going to be great for Australians more broadly,” he said.

“More people getting more advice about what they should be doing has got to be seen as a positive.”

Speaking with ifa, Mr Ashenden added that taking superannuation funds as an example, making it easier for them to provide the limited level of advice through “qualified advisers” would certainly expand access to advice.

“That’s more people that can provide advice, at least around the superannuation side of this,” he said.

“I think that’s good because there’s a lot of people who probably need to get that type of advice and right now, perhaps they can’t afford to go and see a fully-fledged financial adviser.

“Opening up that opportunity for them is a real positive side of things.”

The proposed system, however, is not without challenges. Mr Ashenden pointed out that as the super fund trustee would be acting as the licensee, they would need to be comfortable that their people can still meet the best interests duty.

“Understanding what that means in an interfund advice, in a limited advice-type scenario, is going to be key to it,” he explained.

“It’s not going to be easy because it’s a change. People have to get comfortable with the potential risks that are involved. So, I don’t think we’ll see it change rapidly.

“Even if you know if the legislation was to be effective tomorrow, it’s still going to take time to actually get people trained. You’ve got to work out from a licensee perspective. What are all your compliance controls and everything you have in place? It comes back to the question of even though you could do it, do you want to do it?”