COVID-19 has impacted many aspects of how we do business. The social distancing measures mean many of us are embracing technology to interact with clients. Face to face meetings have made way for virtual meetings, webinars as well as mobilising our remote workforce to ensure a seamless client experience. Much of your attention may have been focussed on reaching out to clients to reassure and re-engineer strategies as well as nurturing staff.
Running parallel to the pandemic is the implementation timeframe for the Hayne Royal Commission recommendations, some of which had a proposed commencement date of 1 July 2020. There is no doubt the industry is committed to implementing the Hayne recommendations. Even before the world changed, many businesses had made inroads into complying with the changes brought about by the Hayne Royal Commission recommendations. But we are living in unprecedented times. The emotional aspect of being in the business of providing financial advice to those who engage our services is becoming clearer. Our clients are looking to us to guide them through this and we are responding. EQ is the new black and the emotional needs of clients and staff is where attention should be.
The Government has acknowledged the need to balance regulatory reform with the need to service clients and has announced a six-month deferral to all the implementation timeframes outlined in the Royal Commission roadmap. Where legislation was due to be implemented by 30 June this year, this will be extended out to 31 December 2020. This includes the obligations under enforceable code provisions, the new annual renewal and payment for financial advice, the requirement to disclosure lack of independence, the inability to deduct advice fees from MySuper accounts and the limitations on deducting advice fees from choice accounts. Additionally, Licensee obligations that also have a six-month extension include the reference checking and information sharing obligations as well as the obligations to report both compliance concerns and misconduct of financial advisers.
Also being extended out six-months are those that should have been consulted on and had legislation implemented by 31 December 2020. While the single disciplinary system for financial advisers and the compensation scheme of last resort were anticipated to commence on 1 January 2021, this will now have a 1 July 2021 commencement date. These measures are designed to provide redress where advisers get it wrong and will also strengthen regulatory powers.
While a six-month extension may provide welcomed respite for businesses balancing client’s interactions with preparing for future reforms, we must not take our eye off the ball. Before you know it, we will be heading into the festive season with the prospect of large legislative reform being wrapped up and left for you to consider. Getting on the front foot now can help ease both the time, complexity and cost of preparing for these changes.
This document has been prepared by BT, a part of Westpac Banking Corporation ABN 33 007 457 141 AFSL and Australian Credit Licence 233714 (Westpac), and is current as at 11 May 2020. Material contained in this document is an overview or summary only and it should not be considered a comprehensive statement on any matter or relied upon as such. This document may contain material provided by third parties derived from sources believed to be accurate at its issue date. While such material is published with necessary permission, no company in the Westpac Group accepts any responsibility for the accuracy or completeness of, or endorses any such material. Except where contrary to law, we intend by this notice to exclude liability for this material. The information in this document regarding legislative changes is intended as a guide only. It is not exhaustive and does not constitute legal advice. It is based on our interpretation of the law currently in force on the date of this notification and does not undertake to provide any updates to the extent that any of the laws or regulations referred to change in the future. Consequently, it should not be relied upon as a complete statement of the relevant laws, the application of which may vary, depending on your particular circumstances. This information does not take into account your personal objectives, financial situation or needs and so you should consider its appropriateness, having regard to these factors before acting on it. Any case studies and examples used in this document are purely for illustration only.