The Financial Planning Association (FPA) has backed key proposals in the Australian Law Reform Commission (ALRC) second interim report on ways to keep existing financial services regulations “fit for purpose”. 

FPA says in a submission it agrees with recommendations to repeal “redundant and spent” provisions in corporations and financial services legislation; amendments to address “unclear or incorrect” provisions; and also changes to “simplify” the current regime. 

The submission says the ALRC review “greatly complements” the Quality of Advice (QAR) Review led by Michelle Levy, who is expected to hand her final report to the Federal Government by Friday. 

“The ALRC package of proposals to simplify the legislative hierarchy to improve navigability of the law and remove duplication is vital to the success of the recommendations of the [QAR],” the submission says. 

“We are encouraged that the ALRC has been liaising with Ms Levy as the current regulatory environment for the provision of financial advice is excessively complex and burdensome on users of the law.” 

FPA says the ALRC and QAR preliminary reports have highlighted that “duplication” in the law exists on two levels: unnecessary repetition of identical provisions and specific obligations placed on the same provider through multiple applications of “like” obligations. 

As a result, financial planners are faced with “regulatory duplication” created by both the structure of the legislative hierarchy and the obligations contained in the financial advice-related provisions, FPA CEO Sarah Abood said. 

“This significantly and negatively impacts the affordability and accessibility of financial advice for consumers.” 

The ALRC review is part of the previous Morrison Government’s response to the Hayne royal commission final report in 2019 to look into the potential simplification of Australian financial services laws. 

A third interim report focusing on potential reframing or restructuring of Chapter 7 of the Corporations Act is due by August 25 next year, followed by a consolidated final report by November 30. 

Click here for the FPA submission.