SMSF Association Media Release
Financial advisors and licensed accountants are facing a threefold increase in their ASIC levy to $3217 – an increase the SMSF Association says risks driving more advisors out of the industry.
Association CEO Peter Burgess says this massive increase, particularly for advisers who are self-licensed, when coupled with the $1500 minimum levy fee charged to each licensee for a combined cost of $4717.
“The exodus of advisors from the sector is well documented and this latest fee increase will have a significant financial impact on those who remain in the sector under ASIC’s cost recovery model.”
Burgess’s comments come in the wake of the release by ASIC of its Cost Recovery Implementation Statement (CRIS) estimates for 2022-23 on Wednesday, and following Monday’s release of Treasury’s Review of this cost recovery model.
On the release of this Review, the Minister for Financial Services, Stephen Jones, signalled the end of the temporary levy relief that had been in place since 2021 when the fee was frozen at the 2019 level of $1142 per advisor. This was after the 2021 estimated fee reached $3138 per adviser.
Burgess says: “This fee increase is a heavy blow for the advice industry, coming at a time when industry is actively consulting on the Quality of Advice Review (QAR) recommendations and working out how the advice process can be improved to make it more cost effective and accessible to more Australians.
Many advisers operate from small businesses, making these kinds of fee increases difficult to absorb.
“Particularly in the current economic climate, these cost increases are not sustainable, and we would urge ASIC and the Government to rethink this decision.
“What the sector needs now is a period of stability to retain existing advisers, the resolution of the QAR recommendations and a review of the education and entry pathways to ensure a healthy, sustainable sector – not a hefty fee increase.”
He adds, “We are also concerned about the impact this latest levy hike will have on the small pool of accountants who have remained in the sector despite the many headwinds and what this will mean for SMSF trustees who rely on their accountants for essential SMSF and superannuation advice.
“As we argued in our submission to the QAR, qualified accountants have a vital role to play in filling the advice gap in the SMSF sector.”