The government is not mandating financial planners use one remuneration structure over another as it consults with the financial services industry on the Future of Financial Advice reforms.
Speaking in parliament last week, Chris Bowen, minister for financial services, superannuation and corporate law, said while there will be a ban on conflicted payments, the government is not interested in prescribing how advisers charge clients.
"There will still be flexibility in how advisers can charge clients and how clients pay for advice. It is open to advisers to devise a charging structure that suits them and their clients," he said.
"That structure could be hourly fees and percentage fees - subject, of course to the guiding principles of the reforms."
Investment Trends research released when the government proposed the reforms found more than 56 per cent of 1,401 financial planners surveyed source their revenue from commissions.
Separately, he said the government's opt-in provision, where clients must choose to pay for the advice at a specific time, is an important measure but one he continues to consult the industry about.
Overall, Bowen said the proposed reforms have been positively received by a range of stakeholders, noting the Financial Planning Association (FPA) and the Investment and Financial Services Association (IFSA) have agreed with the "broad thrust" of the package.
We invite you to watch our latest video featuring Bell Direct chief executive officer Arnie Selvarajah.
In the video and accompanying article he explains how easily the increasing number of advisers using ... Watch video
We invite you to watch our latest video featuring the head of ANZ ETFS, Kris Walesby.
In it he introduces a new ETF, due for launch later in July, which tracks the Euro Stoxx 50 index of major companies ... Watch video
We invite you to watch our latest video featuring Zurich Investments senior investment strategist Patrick Noble.
The question of how to generate a satisfactory return to meet investors' needs is becoming ... Watch video
Financial Standard editor Mark Smith presents a roundup of the week's biggest industry news and executive appointments. In this week's news:
O'Dwyer says life insurance back on the agenda
After being ... Watch video
With an 8-14% per annum return objective over the long term, the Pengana PanAgora Absolute Return Global Equities Fund is clearly managed by a team with investment acumen and a well thought out process.
Broadly ... Watch video
Get it Daily
FREE to your inbox, get the Financial Standard Daily Email.