The SMSF Association urges the Government to reconsider key aspects of its proposed financial advice reforms, cautioning that consulting on key reforms in isolation risks increasing complexity, red tape and the cost of providing financial advice, undermining the core policy objectives.
Following their submission to Treasury on the Treasury Laws Amendment Bill 2025: Delivering Better Financial Outcomes exposure draft, SMSF Association CEO Peter Burgess said, “While we support reforms that aim to increase access to affordable, quality financial advice, these measures must be implemented collectively, not piecemeal, and they must maintain a level playing field for all advice providers — including the many small businesses serving SMSF trustees.”
The Association is concerned about the proposed collective charging model that allows large superannuation funds to deduct advice costs from member accounts — a luxury not available to financial advisers, who must charge clients directly and meet strict disclosure requirements.
“This model risks entrenching an unfair competitive advantage. Superannuation funds will be able to offer so-called ‘free’ advice when, in fact, the cost is being cross-subsidised across members,” Burgess said.
Further, without clear parameters defining what constitutes ‘simple’ versus ‘complex’ advice, the proposal opens the door to inconsistent application across funds.
The Association supports the policy intent behind targeted ‘nudges’ to improve retirement outcomes. However, it warns the proposed framework is overly complex and risks consumer confusion. Current drafting may mischaracterise general information as ‘superannuation-related advice’, potentially misleading members.
The Association also calls for SMSF professionals to be included in the nudge framework, noting their trusted relationships with clients and deep understanding of trustee needs.
“With more than one million SMSF trustees in Australia, it’s counterproductive to exclude SMSF professionals, who are uniquely placed to assist at key life stages, from being able to prompt clients to seek advice that’s right for them,” Burgess said
While supporting the intent to streamline the advice process, the Association believes the Client Advice Record (CAR) risks becoming a rebranded Statement of Advice — requiring substantial and costly system and process changes without any meaningful benefit to consumers.
“We question the regulatory burden imposed on advisers by these reforms for what is essentially a name change,” Burgess said. “Genuine simplification must focus on content, not cosmetics.”
“Given the close relationship, any reform of the client advice document must be considered alongside reforms to the best interests duty and the Code of Ethics. Considering these in isolation risks misalignment and unintended consequences with added costs and complexity.
The SMSF Association is urging the Government to pause the current package and release the full suite of proposed reforms for comprehensive consultation.
“The pathway to legislative change is long and difficult, so we must get this right now. Partial reform risks making the system more complex, not less,”
“To achieve meaningful change, we need coordinated action — not fragmented rule-making that embeds more challenges for the profession,” Burgess said.