Revealed: How much it cost to develop the Code
The original budget to write a new Code of Conduct for financial advisers was $150,000, but the total cost so far is more than three times that amount; and the job is still not finished.
Wednesday, May 1st 2019, 6:00AM 
5 Comments
In response to an Official Information Act request, the Ministry of Business, Innovation and Employment said the Code Working Group, tasked with delivering the code, had so far cost $506,946,94.
That included fees for those in the group, travel to meetings and roadshows, the webinar and associated services, room hire, and consulting fees for legal advice and a plain English drafter.
The group has conducted a focus group, consumer survey and two formal consultation rounds.
“The group was funded from MBIE’s baseline, therefore there was no formal budget identified for the development of the new code of conduct. However, in January 2017, prior to the appointment of the Group, officials at MBIE estimated a cost of $150,000 for member fees only,” said Sharon Corbett, manager of financial markets policy building, resources and markets.
“This was a very early estimate before the appointment process was completed and was based on there being fewer members [seven] taking less time [10 months] to deliver a draft code. As above, the initial estimate only covered members fees and not the other items detailed above.
“There has been considerable interest in the consultations the group ran and the group considered a significant volume of submissions which added to the time taken to develop the code.
“These processes often take longer than initially anticipated and it has been important to ensure the group had sufficient time to get the code right. The draft code of conduct is currently with the Minister of Commerce and Consumer Affairs who is considering it.”
It had been expected that the code would be finalised in the first quarter of this year but that has not yet happened. The proposed Code is with the Minister of Commerce Kris Faafoi, who has yet to approve it.
The code is being developed to sit alongside the new Financial Services Legislation Amendment Act.
It will apply to all advisers offering personalised advice. It includes requirements for qualifications as well as ethical and client-handling considerations.
| « Build your business with a trusted brand | Mann on a mission to diversify financial advice » |
Special Offers
Comments from our readers
While I have great sympathy towards your view of the plethora of working groups, your slings and arrows in respect of the CWG are misdirected.
CWG was announced on 21 June 2017 by then National minister Jacquie Dean.
CWG has been on the job for 21 months to date. That seems very slow. I think I might need to apologise to FSC because when they announced it had taken them 12 months to develop their Code, I said "what took them so long". Relatively they were cheetahs.
As an aside, it was interesting that when i went to official websites to confirm my recollection, all evidence of pronouncements under the previous government was missing.
Is it a case of "The King is dead. remove all evidence of him. Long live the King."
Interestingly today is day 61 since the Minister received the Code from CWG. I can now confidently predict that unless FMA has objections that means it needs to be sent back by the Minister to CWG, the Code will be published in the next 29 days.
If it turns out they haven't raised any objections, i might once again ask "how come it has taken so long to publish?"
Sign In to add your comment
|
|
Printable version |
|
Email to a friend |
In fact - I actually heard a member of the tax working group present in Nov 18 where he clearly stated that it was unlikely that many of the TWG's proposals would ever be accepted (noting the restrictiveness of their terms of reference).
I can only assume that these working groups are the brainchild of a political party that was devoid of ideas ahead of their unexpected election.