Senator Andrew Bragg has confirmed legislative changes to advice are around the corner, telling Michael Rice the Corporations Act needs to be updated.
Bragg, in conversation with Rice for a Financial Services Council webinar, said he is an avid user of advice himself and believes it has become inaccessible to many due to its high cost.
"I agree that the cost of advice is too high, but it is a difficult issue. We want to make it accessible and affordable for Australians," Bragg said.
"It is a heavily regulated area, for various reasons, and I think it needs to be but there must be ways we can improve the system."
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Bragg said the government is looking at a "tech-neutrality" approach, discussing updating the Corporations Act to allow for more digitisation.
"The Corporations Act was written in 2001, so there is no longer a need for a wet signature or physical AGMs," he said.
"We should be able to do away with those things, especially given the changes we have had to make due to the COVID-19 pandemic."
Bragg said allowing for more tech-neutrality in the advice space will help lower the cost of advice and said changes of that nature will be made public by the government soon.
Bragg also discussed his thoughts on the superannuation system, saying the government should have a larger role in regulating the industry.
"The idea that we cannot intervene in a government-established superannuation market is ridiculous," Bragg said.
"We need radical market surgery to get better results for members; we need to stop having an opaque system."
Bragg reaffirmed he believes Australia should use the Future Fund as the default super fund for all Australians, with individuals making the decision to switch to another fund if they see fit.
"We need a 'cheap-and-cheerful' government fund option, Australians are so heavily invested in this scheme, we need to ensure they are getting the best deal possible," he said.
"Future Fund has investment management capabilities and would be an easy thing for us to establish, and would provide a better deal to members."
Bragg said the super industry needs to focus more on helping Australians into the housing market, referencing research by Rice Warner and Grattan, which suggests those who own a home are more likely to avoid poverty in retirement.
"We have a rigid system here; we give our money to super funds and insurance, and while insurance can benefit some for others it is simply a drain on their retirement savings," Bragg said.
"Home ownership is the most important factor. The answer to every questions is not 'more super', for many Australians it is to own a home."
The advice Bragg offered the super industry is to form a "better view" on home ownership, saying the industry is not doing enough.
"Funds don't want to do this because they say it's not in their commercial interest, but they need to look at this issue," he said.
"People think you're a heretic if you question the super system today, but the fact is in terms of owning a home we need to have a debate around reversing the decline in home-ownership in Australia."