SMSF Association welcomes ASIC levy reduction

The SMSF Association has praised the adviser levy relief for providing advisers with “breathing space” amid a period of regulatory upheaval.

The move would mean the levy from the Australian Securities and Investments Commission (ASIC) would be held at the FY19 level for the next two years of $1,142 per adviser, as opposed to the previous estimate of $3,138.

Association chief executive, John Maroney, said the fact that many advisers worked in small and medium-sized businesses meant they were ill-equipped to cope with large cost increases like those proposed by ASIC.

“The freeze in the per adviser levy will provide advisers with much needed certainty and breathing space at a time when the advice industry is not only dealing with the impact of COVID-19 but is facing long-term structural change with the introduction of a single disciplinary body and a compensation scheme of last resort currently before the Parliament,” Maroney said.

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“Significantly, the Government has also signalled it will review the ASIC industry funding model, an initiative we have been calling for almost since the inception of the levy under the Australian Government Cost Recovery Guidelines.

“When the levy was introduced, there were 26,000 financial advisers, a figure that has fallen to nearly 19,000. Consequently, the cost per adviser has been rising exponentially.

“It’s also worth noting that a large portion of individual financial advisers work in small and medium-sized businesses and don’t have capacity to absorb large and unpredictable increases in costs. So, these costs are ultimately borne by consumers, making financial advice even more unaffordable.”