Essentially the FPA would like financial planners, its members and hopefully all other Australian-based planners, to adopt a fee-only remuneration model by 2012.
For many within the industry such a call has come too late. Fee for service is what they live and breathe. For others, it has caused only a slight headache as they were already on the journey away from commissions. For others, it’s a call for a one-size-fits-all model – an impossible ask.
The association claims the decision to call for uniformity surrounding advice charging models is purely in the interest of the client.
The FPA’s association rival, the Association of Financial Advisers (AFA), continues to push for the idea of choice of remuneration models for advisers.
AFA chief Richard Klipin says the way an adviser charges for services does not make them a better or worse adviser and simply being fee-based will not guarantee consumers receive better quality advice or that advisers will build better businesses.
“While some of the recent debate on this issue has been spot on, some has been filled with distortions that cloud and hamper the issue,” Klipin said.
“It’s time for some clarity.
“The AFA is committed to leading and supporting its members throughout this debate, regardless of how those members are remunerated. Our mission is to help our members in their role to build, manage and protect the wealth of everyday Australians.”
In this week’s edition of IFA, we have dedicated our cover story to just this topic – advice models.
The decision to cover the topic had been on the boil for a number of months, though it seemed even more poignant following the release of the FPA’s consultation paper.
The article contains comment from a number of the industry’s top advice firms, including PIS, AMP, MLC and Axa.
IFA does not attempt to sway the debate for either a fee-for-service or commission-based advice model for Australian financial advisers; we merely offer a thought piece for our readers.
We hope you enjoy it.
