Slade Brockman (WA, Liberal Party) Share this | Link to this | Hansard source

I rise tonight to speak on an issue that is very important to the structure of our economy and very important, in particular, to the liberal philosophical view of the world. That is the importance of wealth creation. Sometimes in this place, particularly listening to those opposite, you would think that wealth creation is somehow a dirty phrase, when, in actual fact, it is the core of what we want in society. We want families to get ahead, we want individuals to get ahead and we want small businesses to be able to thrive, develop, employ people and grow. Sadly we have seen, over a number of years, increasing pressure on a particularly important component of that wealth generation capacity in our society, and that has caused a severe decline in the number of financial advisers within Australia. We've seen those numbers reduce from something approaching 26,000 to 30,000 to around half that today. That is on the back of an increasingly burdensome set of red tape, regulations and costs imposed by government.

A financial adviser who works in the industry recently sent me a list of the costs that are imposed upon them before they even open the door—before they can even serve one client. Not all of these costs are government costs, and I acknowledge that, but significant parts of them are, and that is something that we, in this place, can actually do something about. I'm just going to run through some of them briefly. We've got the Australian Financial Services licence. For this particular adviser, you're talking about a minimum fee of $1,500 and then another $2,800 in a graduated fee. For a securities dealer, you add $1,000 to that. Then there's an additional fee for life insurance distribution. The new Compensation Scheme of Last Resort is likely to add something like $7,500 to that amount. Again, it's a direct charge from the financial regulator on small financial advisers.

You've also got the AFCA levy. You've got public indemnity insurance and professional indemnity insurance, which can be up to $15,000 or even higher depending on the size of your practice. You're looking at wages for your support staff, rent, software and compliance costs, including very important things like providing sufficient cybersecurity to protect client records. All those things are absolutely essential to have before you serve one client. But what's this adding up to before a business can even open its doors? You're looking at between $100,000 and $200,000 for every financial adviser before they can even open their doors and give a small amount of advice to one client—one family that wants some financial advice, one small business that wants some financial advice or an individual who's trying to get ahead in our society.

We believe in people growing their wealth and being able to access high-quality financial advice, whereas those opposite believe in 'set and forget' financial futures. They believe in pushing, in particular, the industry super funds so people just put their money away, then walk away and forget it. This is not the way we should be thinking about our financial future. We want Australians to engage with their financial futures, to actively engage with wealth generation and to be the best they can be as individuals, as families and as small businesses. One of the key components to doing that is a strong, vibrant and not overregulated financial advice sector. It's time we had a cold hard look at the sheer level of regulation and cost we are imposing as a society and as government on this sector and think about ways we can reduce those costs and reduce that burden so more Australians can actually access high-quality advice to improve their financial futures.