FAAA pushes to expand NCA to financial advisers

Financial Advice Association Australia (FAAA) said it will advocate strongly to expand the scope of the New Class of Advisers' to all financial advisers, which will currently be limited to only superannuation funds and life insurers.

The reforms will help Australians access advice via their super fund.

Assistant Treasurer Daniel Mulino said the measures will be subject to a review three years after commencement to evaluate the scope and operation of the reforms.

"We don't agree with it being restricted now, we accept that that is the government's direction, but we'll be advocating very strongly for that to come off in three years' time," FAAA chief executive Sarah Abood said.

Abood added the industry needs to be very careful about the scope of the New Class of Adviser and how consumers will be charged. She added it is important to ensure the New Class does not impact the services provided by advisers.

"Let's not forget what it's called. Our members have been very clear that the word advice should not appear in the name of this New Class. We're very, very focused on that," she said.

"The minister also is on record saying that the services that this new class will provide will not impinge on the services provided by comprehensive advisers...we will hold the minister to that. That is a really important control."

FAAA general manager, policy, advocacy and standards Phil Anderson, who retires on November 27, added the New Class of Adviser is one of the most contentious parts of the DBFO reforms.

"It was initially proposed to be very tightly scoped and limited to entities where it wasn't necessary to charge a fee. But the government, over time, before we ran into the complication of Shield and First Guardian, had agreed as the result of a lot of advocacy to extend it to include advice practices and allow them to be able to charge for that," Anderson said.

"Now that seems not to be the position that they've taken at this point, but they have committed to reviewing it in three years' time, and we will be advocating very strongly to make sure that any opportunity that's available to super funds and life insurers should also be available to financial advisers."