Industry groups seek more information

There’s tentative support for the establishment of Financial Advice New Zealand from some of the industry’s other professional bodies – but a call for more detail.

Wednesday, June 29th 2016, 6:00AM

by Susan Edmunds

Members of the Professional Advisers Association and Institute of Financial Advisers will vote next month on the establishment of Financial Advice NZ, a new association.

The presidents of IFA and PAA have said they hope its membership will be wider than just the members of their existing association.

Gary Young, chief executive of the Insurance Brokers Association of New Zealand, which represents fire and general brokers, said he had spoken to the IFA and PAA about the idea.

“The IBANZ position is we are seeing what they are doing and it is more at the stage of a concept at the moment. IBANZ is obviously interested in whatever is going on in the sector but at this stage it’s very much in wait and see mode.”

He said one larger association would have more clout than lots of smaller ones. “But counter to that, can one overall organisation represent such a wide spectrum of industries or professions? Financial advice is very diverse. Can one organisation represent such a diverse grouping? Ideally it could but pragmatically, will it?”

Wayne Smith, of the TripleA Advisers Association, said it would be premature to comment. “It’s fair to say we are watching it. At this stage we are waiting to see what develops.”

Robert Oddy, of SiFA, said he, too, could understand the appeal of a larger organisation.

But he said he could not understand how PAA and IFA members could be expected to vote on a new association when there were no details available on the type of organisation it would be.

“They say it’s a blank sheet but why would anyone vote to go and join a blank sheet? They may be seeking agreement to go and spend the money to investigate what form a new association should take but in the absence of a cost/benefit analysis it seems very difficult for anyone to make a decision.

"It's like John Key saying 'why don't we agree to have a new country called Mickey Mouse Land which will be Australia and New Zealand and then we might invite Fiji, Tonga and Niue to be part of it'. People would want to know what are the benefits, the costs and the political implications of that?"

He said it would be difficult for an association to represent both consumers and advisers, which it has been indicated Financial Advice NZ would aim to do

Tags: IFA PAA