Within the short few months the UFAA has been in existence we have:
• increased our following to over 6,000 advisers from all over Australia
• built a mailing contact list of some 11,000 respondents
• met with various Government Ministers and Members of Parliament
• broadcast our message in industry-based magazines
• highlighted the need for action in protecting the ongoing viability of our industry
• called out the hypocrisy of the FASEA CEO
• co-ordinated thousands of letters and emails to local members
• called out the AFA and FPA for being conflicted in their relationship between their members and the institutions that fund them
TAKING ACTION FOR YOUR FUTURE
As practicing advisers, we take the view that the two most recognised bodies representative of advisers, the Australian Financial Advisers Association (AFA) and the Financial Planning Association (FPA) do not truly represent the views of advisers when making representations to Government.
It is common knowledge that both associations do not consult with their respective membership when they prepare and make their submissions to Government.
The AFA and the FPA provide little more than lip service to the negative impacts of the reforms and walk-in lockstep to support the FSC – who only work in the best interests of the banks and large institutions.
It has become clear that both the AFA and FPA are conflicted in their role representing advisers.
Both the AFA and FPA, receive substantial revenue inflow from institutional sponsorship. It is the institutions such as bank aligned and owned life companies, that have pushed the agenda set by the Financial Services Commission to remove trail commission and lower life insurance commissions paid to advisers.
We put forward the argument from experience sighted in other countries such as the United Kingdom, that properly managed and reasonably set commissions scales will make for a sustainable industry that provides accessible advice to consumers.
Most countries that reduced or abolished commissions have brought them back in order to rebuild decimated industries!
It is a common thought amongst advisers that the recent Royal Commission into banking was a farce and was a pre-determined outcome.
Banks openly made admissions to bad and deceptive conduct.
However, in their defence and seeking a scapegoat, the banks laid the blame solely and squarely at the feet of non-bank-aligned advisers and blaming adviser commissions as the basis of all improper actions.
However, what was not mentioned, and was common knowledge amongst financial advisers, was that vertically integrated product pushing by institutions was the cause of the majority of consumer complaints and as a result, the highest amounts of client remediation payments, running into the hundreds of millions of dollars.
So strong was the argument against commissions that one main recommendation delivered by Commissioner Haynes was to implement the removal of new business commissions to mortgage brokers. A group that held a 60% market share and obvious competition to bank profitability.
It was only after an intense lobbying effort and advertising campaign by the two major mortgage broker associations that a decision by the Morrison Government to reverse the abolishment of mortgage broker commissions was implemented.
After observing the campaign launched by the mortgage brokers associations and witnessing what the power of a united voice could achieve, the UFAA put out a call to advisers to begin to bring together those disaffected and disillusioned by the LACK OF ACTION by the AFA and FPA.
Our feedback taken from adviser comments made over the last ten months tells us that the main topics driving adviser discontent are:
• Lack of action taken by FPA and AFA – LIF debate, ARC Funding, FASEA
• The upcoming LIF Review – commissions in Life Insurance
• Removal of grandfathered revenue
• Code of Ethics
• Recognition of prior learning
• Recognition of experience
• The overall effect and cost to clients
It is through this disillusionment and discontent that advisers are seeking leadership from a body that truly unites all advisers and provides a voice on behalf of all advisers.
The UFAA is prepared to act on behalf of advisers.
We have been publicly criticised for daring to speak the truth and for further destabilising advisers by “forming another adviser association body”.
Our reply quite simply is “if the AFA and FPA had done the right thing by advisers in the first place – there would not be a need for an association such as the UFAA”.
We take this criticism seriously, as we know it falls right into the hands of the Government. Senator Hume suggests the Government needs to take action because the adviser industry is not united.
In response to this, in late December 2019, the UFAA sent an open letter to the AFA and FPA inviting the CEO’s of both organisations to come together to meet with our Chairperson and discuss the possibility of joining and becoming ONE UNITED VOICE to represent the real interests of advisers across Australia.
To date, we are still waiting for a reply.
However, this does not diminish our commitment or passion.
Collectively, we still have a long way to go in delivering the right message to Government!