Shattered trust: The unmet expectations of QAR

Here I am on a Monday morning, struggling to put into words where it all went wrong. Remember Minister Stephen Jones’ promise to fix the “hot mess” that is advice? Well, it seems like he decided to go all-in on making it an even hotter mess, throwing more wood, coal, and pretty much anything he could find onto the fire. It’s like he took a bad situation and cranked up the heat a hundred times over. What a week, right?

The advice profession came to terms with the fact that the Quality of Advice Review (QAR) wasn’t really about them a while back. They accepted the fact that while the QAR promised to eradicate some of the severe red tape remnants of the royal commission, its core aim was to bring more advice to more Australians.

It was around mid-year, just before Financial Services Minister Stephen Jones unveiled the government’s initial QAR response, that we came to realise that we really couldn’t let perfect be the enemy of good.

Advisers even got on the bandwagon, thinking that maybe giving superannuation funds more advisory powers could be a positive move. The catch was simple: as long as the minister assured everyone that funds wouldn’t be shoving backpackers into hidden call centres, and as long as these fund-backed straightforward advice providers were legit, it seemed like things might play out in advisers’ favour.

We even began to envision an industry where funds helped funnel more candidates into financial advice, an industry where funds worked hand in hand with professional advisers to ensure Australia’s retirees got the retirement they deserved.

And then the first tranche of the government’s legislative response dropped, putting a bit of a stain on our hopeful fantasy. You see that red tape relief the minister had promised wasn’t quite there, but we listened and trusted when he said that it was coming.

Back then, he assured us that by the time Santa made his rounds, we’d have a clear picture of where the government stands on the QAR and what legislative plans they had in store.

True to his word, and perhaps in a surprising twist of punctuality for Jones, we were summoned to Canberra bright and early on 7 December. Alongside a crew of top-notch professionals, we gathered to hear the minister’s presentation.

And then came the moment we’d rather forget.

No need for me to replay his words or dwell on the fact that he metaphorically slapped, no, gut-punched the advice community, that he shattered nearly every promise he made since May last year, all with a smile on his face.

What’s truly irreconcilable is the notion that maybe he never made an effort to understand in the first place.

Does he not understand the toll the professionalisation of the industry emerging from the ruins of the royal commission, has had on the advice community?

Doesn’t he recall the havoc wreaked by the banks when they had unchecked control over the advice industry? What was the royal commission all about, anyway? Why did we invest years in purging the industry of its tainted reputation?

Did he listen to advisers at the dozens of meetings he attended across the country?

And finally, but most importantly, why “qualified adviser”?

Above all else, beyond the notion that banks have a role in advice, what truly outrages, hurts, and demoralises advisers is the idea that a bank employee could be given the title “qualified adviser” with nothing more than a yet-to-be-determined diploma under their belt.

What happened to his commitment to ensuring that consumers are not taken advantage of?

We have a lot of questions that will likely remain unanswered but one truth has emerged – those two words, “qualified adviser”, were enough to bring Jones’ reputation crashing down.

While the advice profession has the opportunity to sway his decision through advocacy and submissions, the undeniable truth remains that after months of consultations, submissions, promises and seemingly false understanding, all the minister could deliver was the one thing that the advice profession feared the most.

I sense that trust has been irreparably shattered. My only hope now is that this adversity prompts at times a profession to come together in alignment and agreement, forging a new bond among the some 15,600 professionals.