Government pushes advice out of reach
Between the 2019 Royal Commission into misconduct in the banking, superannuation, and financial services industries and new stringent educational requirements imposed by the Financial Adviser Standards and Ethics Authority (FASEA), the total number of Financial Advisers in Australia has dropped considerably.
Between March 2020 and March 2021, the number of Advisers dropped by 11%; back to 2016 pre-Royal Commission levels. This means that getting financial advice is becoming increasingly difficult.
Large licensees who are signing sizeable numbers of Advisers on, are concurrently losing almost as many.
Only 14,487 Advisers, a third of the total number of registered Advisers, are authorised to work in the risk advice segment, making it even harder to get personal insurances recommended or reviewed.
The statistics are telling – during the March 2021 quarter alone, 1017 Advisers stopped being registered with advice licensees, while only 538 Advisers took out new registrations.
The Royal Commission and the introduction of FASEA have dramatically reduced the number of Advisers in Australia, while also increasing the compliance cost of providing advice. In turn, these compliance costs have increased the cost of advice, to the extent that advice is now inaccessible to most Australians.