The government is unintentionally devaluing financial advice by viewing it as a transaction between an adviser and client rather than as a business relationship, an industry director has said.
Strategy Steps director Louise Biti said Treasury has misunderstood the relationship between a financial planner and their client.
"I think it's interesting, an environment where in some ways the government is really nearly devaluing what advice does and how advice can be important for people," Biti said.
"When you start looking at intrafund advice and MySuper, the government has a view that financial planning advice is very transactional, that you have an issue, you have a question and you go and get that answered and you go and get that on.
"There is obviously a lot of reform that needs to be done in the whole industry to make sure those relationships are truly priced correctly, serviced properly and the competency levels are there to do that as well."
Biti, who is also the chair of the FPA's Future of Financial Advice [FoFA] taskforce, said Minister for Financial Services and Superannuation Bill Shorten is committed to the MySuper concept and to the FoFA reforms.
"Treasury has come out and said they are absolutely committed to implementing things like the best interests, so they have moved away from the fiduciary legislated responsibility for financial planners and are going to adopt more of the best interest type concept, which has the same outcome but just a different way of putting it," she said.
"They are very committed to the opt-in provisions. They really want to stop what was happening in the market in a lot of cases, where planners were getting passive income and not providing services and they want to move away from disclosure on fees as that's not working."
Biti said advisers need to re-engage their clients if they are to help shift the government's understanding of what financial advice is.
