by Rob Hosking
The task force widely circulated two questionnaires before Christmas – one to the industry, the other to consumers. Although the official deadline for replies was last Friday, the task force is taking responses until the end of the month.
Financial Planners and Investment Advisers Association chief executive Phillip Matthews says advisers need to get as many of their clients as possible to respond to the survey.
Matthews warns that if they do not there is a risk of the process becoming a one-sided one.
“Those who have had good experiences need to be heard to balance the more likely responses from those who have not had good experiences,” he told a forum organised by the FPIA’s Wellington branch.
Matthews says the task force is an opportunity to extend some of the FPIA standards and values to other advisers who do not come under its ambit.
“However whatever form new regulation finally takes, it should not decimate the financial advice industry and it should not put up the price of advice to the client.”
The task force and other government moves will mean more regulation with three main facets, he told the conference: minimum competency standards, an ethical code of behaviour, and a complaints process.
Meanwhile Retirement Commissioner Diana Crossan said that financial advisers need to do a lot more to gain the trust of the public.
“There are three vital elements for an effective framework – stable Government policy, a trusted financial services sector and an educated population.
“We have the first element and the Retirement Commission has a major focus on education, but we definitely don’t have enough trusted financial planners in this country at present.”
In a fairly blunt speech, she said that people often tell her office they do not know who to trust for advice.
“For 20 years the financial services sector has been saying it would develop self-regulation but that hasn’t happened.
For the past 10 years it has talked about developing a single body to oversee the industry and handle complaints but this hasn’t happened. There are several organisations for financial planners but about 50% of financial planners don’t belong to them.”
Rob Hosking is a Wellington-based freelance writer specialising in political, economic and IT related issues.
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