The FPA’s comments that the superannuation savings of millions of Australians will be at risk due to the decision to give legislative relief to superannuation trustees when providing limited personal advice to fund members is self serving, the Australian Institute of Superannuation Trustees has said.
“She [FPA chief executive Jo-Anne Bloch] eluded in a statement that it was a disastrous public policy and would enable people to get bad advice through their super trustees,” AIST chief executive Fiona Reynolds told InvestorDaily.
“I’d like to point out that all the recent media coverage regarding bad financial advice has in fact been about financial planners through Westpoint, Storm and so on.
“I think the financial planning associations are reacting the way they are because they’re worried this decision will take work away from their members, when in fact their members have never wanted to deal with people who don’t have a lot of money and just want single issue advice anyway.
“Everybody who works in the superannuation or financial services sector knows there is no effective mechanism for people with low account balances to get simple information about their superannuation, for example how to get the co-contribution.
“We see this move by ASIC and the Government as something which will fill a gap in the market not take away something that financial planners do.”
Reynolds said the ruling [which removes the criminal liability provisions for super trustees around providing personal advice for a limited set of circumstances] enables millions of Australians to have greater access to inexpensive advice regarding their super investments.
“The superannuation industry is highly regulated and this decision does not remove all the rules around super trustees having to act in the best interest of their members,” she said.
The FPA’s comments were self serving and did not consider the needs of Australians, while the reaction by both financial planning associations was an overreaction, Reynolds said.
Last week, AIST, the Association of Superannuation Funds of Australia, and the Investment and Financial Services Association welcomed the ruling by the Government and ASIC, while the FPA and Association of Financial Advisers were united in their condemnation of the decision.
