Advice profession in legislative limbo after 650 days

With just three parliamentary sitting weeks left before the year ends and an election looming, the clock is ticking for the government to act on the Quality of Advice Review’s (QAR) final report, which has now sat on Financial Services Minister Stephen Jones’ desk for 650 days.

In a statement marking the occasion, shadow financial services minister Luke Howarth lashed out at the government for breaking its promise to financial advisers, accusing it of not only failing to reduce their costs but also leaving the financial advice sector mired in a “hot mess” of legislation.

Howarth argued that over the 650 days since receiving the final QAR report, the government has diluted Levy’s key recommendations, botched the initial round of reforms, and stalled on implementing critical red tape-cutting measures.

“Like most of its financial services reform agenda, advice reforms have been left to the last minute and are clearly not a priority for this government,” Howarth said.

The advice profession is eagerly awaiting the long-overdue draft legislation for the second tranche of the government’s Delivering Better Financial Outcomes (DBFO) reforms. While behind-the-scenes discussions are said to be ongoing, there’s still no date set for when the minister might announce the start of a formal consultation process.

Speaking to ifa last week, the CEO of the Financial Advice Association Australia (FAAA), Sarah Abood, said she hopes Jones’ recent focus on scams isn’t coming at the expense of DBFO progress.

“Scams are uncontroversial, no one is going to say, ‘I think you’re being a bit too hard on scammers, you have to lighten up’. So, it’s more straightforward in policy terms,” Abood said.

“I certainly would hope that that focus wouldn’t come at the expense of needing to solve the issues in the advice profession, which the minister has said on many occasions he understands and feels they are important.”

According to Howarth, the sector has every right to second-guess whether the draft legislation will actually materialise.

“The industry was dismayed to see the Assistant Treasurer pick and choose Michelle Levy’s recommendations and water down its deregulatory reforms but hopeful he would progress what survived in a timely manner. 650 days have now passed since Jones was handed Levy’s final report and he has been on a go-slow ever since,” the shadow financial services minister said.

He added that unlike the government, which he criticised for “continually scapegoating” its department and blaming a lack of legislative drafters for its shortcomings, the Coalition is committed to fully implement the QAR review.

“The Coalition would implement the Levy review in full and, unlike the government, we won’t treat this as the end of the road for deregulation. This is the beginning, not the end for cutting red tape for financial professionals.”