You might be wondering what became of ASIC's big affordable advice project.
CP 332: Promoting access to affordable advice for consumers, released in November last year, opened the doors for industry stakeholders to give their thoughts on a wide range of topics affecting the advice profession. While the paper itself had a specific focus on the provision of limited/scaled advice, the wording invited feedback on any "issues or impediments [to affordable advice] that are within ASIC or industry's control to act on."
Consultation closed in January and a round of industry roundtables were scheduled to discuss ASIC's findings in "early 2021". Now that we're in mid-April, and ASIC still has yet to make submissions to CP 332 public, it's understandable that advisers would be enthusiastic to find out how such a broad and potentially quite significant project might be progressing.
We don't know too many specifics yet, but following a request from LNP MP Bert van Manen during a parliamentary joint committee meeting in March, ASIC's "high-level briefing" on CP 332 has been made available.
From November to January, CP 332 received 469 submissions, the majority (244) of which came from financial advisers. The remainder were industry associations, super funds, insurers and academics (110), respondents who were both adviser and licensee (72) and licensees (43).
As presaged in the initial consultation paper, many respondents identified RG 244 (ASIC's guidance on limited advice) as being confusing - something the regulator is attempting to remedy through an online hub which will simplify existing examples and provide new ones. Participants also suggested the costs of providing limited advice were the same as comprehensive advice and that licensees, in some cases, restrict limited advice.
On top of this, respondents also noted that the FASEA Code of Ethics doesn't allow limited advice. ASIC said it plans to "pass on this feedback to Government".
ASIC also said feedback on CP 332 identified another key impediment to affordable limited advice: the SOA system.
The briefing explains: "Respondents want more guidance on providing ROAs and have generally submitted they would like to see ASIC promote its use.
"We are considering possible guidance on ROAs and plan to raise ROAs as a key topic for discussion in the roundtables for exploring issues raised in CP 332. We are also considering possible relief to expand the situations where a ROA can be used, for example when providing limited advice or strategic advice."
While the initial briefing (like the consultation paper before it) focuses largely on reducing the barriers to providing limited advice, it touched on several other topics. One involved the manner in which ASIC conducts is industry consultation; many respondents said the regulator should "talk to directly to advisers" rather than just "licensees, professional associations and lobbyists". Related to this, respondents said any new guidance should be "consumer-tested" with advisers to ensure it's clear and useful.
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