Proposed Advice Reforms Risk Preserving the Status Quo
NIBA has expressed concern that the Federal Government’s proposed Statement of Advice (SOA) reforms, as set out in the Treasury Laws Amendment Bill 2025: Delivering Better Financial Outcomes (DBFO), risk maintaining the status quo under a different name.
In a submission to Treasury, NIBA welcomed the Government’s overarching aim of improving the quality, accessibility and affordability of financial advice through clearer and more streamlined regulatory requirements.
However, it warned that the current drafting of the legislation is unlikely to achieve that goal, particularly for general insurance brokers who provide personal advice to retail clients.
A key feature of the proposed legislation is the replacement of SOAs with a new document known as the Client Advice Record (CAR). While intended to reduce regulatory burden and simplify advice documentation, NIBA argues that the CAR requirements closely mirror those of the SOA, meaning that the reforms may result in little practical change.
“While NIBA notes that small changes have been made to encourage the provision of clear, concise and effective advice, on balance, these changes are unlikely to impact the length or complexity of advice documentation”, the submission stated.
While supportive of the policy intent behind the DBFO legislation, NIBA maintains that simply renaming SOAs as CARs does not address the underlying challenges faced by advisers or consumers.
“Without more substantive changes to the underlying obligations and structure of advice documentation, the reforms risk maintaining the status quo under a different name”, the submission said. “We urge Treasury to consider a more outcomes-based approach that prioritises clarity, relevance, and genuine utility for clients, while also recognising the practical realities faced by advisers”.
The draft legislation is expected to go before the new Parliament later this year. However, key elements of the Government’s response to the Quality of Advice Review, such as the modernised best interest duty and the introduction of a new class of adviser, remain outstanding.