UniSuper sees qualified advisers as being beneficial to the fund – and advantageous to the overall advice landscape – but expects its holistic advice service to handle complex needs for members.
The fund’s head of advice and education Andrew Gregory said qualified advisers will help solve advice for the “missing middle” of Australians.
“There is something here that is more of a complement than it is a conflict,” Gregory said in a panel session at the Stockbrokers and Investment Advisers Association Conference in Melbourne.
Minister for Financial Services Stephen Jones unveiled a two-tiered advice model last year as part of the government’s response to the Quality of Advice Review, but drew swift rebuke from the industry over the “qualified adviser” name, which the minister has since conceded could change.
In addition to the controversial moniker, the industry has also raised concerns over the boundaries for what advice qualified advisers will be permitted to give.
Gregory said there is a role for qualified advisers to help delivery of simple strategies, such as retirement income or transition to retirement strategies, where there is a reliance on a digital advice engine subject to the Best Interests Duty, that are delivered through collective charging and which could be self-service or hybrid advice.
“If there is complexity or vulnerability in the way that a member might translate that information, they’ve got a resource like a qualified adviser to translate that advice with them,” Gregory said.
“We’re quite excited about this actually. I see a lot of potential in a business model like ours for the delivering of personal advice to a member through that mechanism and it’s a very basic option.”
At the moment, Gregory noted, UniSuper is providing general advice that can’t take into account personal information, which he expected qualified advisers would have more flexibility with, along with clear guardrails for doing so.
“If there are any risks [of] straddling into areas where a comprehensive question might be more appropriate, we’ve got a very clear handover,” Gregory said.
UniSuper has grown to be a $135 billion fund, which Gregory said was 70 per cent managed in-house, and has achieved organic inflows of $4 billion in the last year.
Gregory, the former CEO of boutique firm Arrow Private Wealth and general manager at MLC Advice, joined the fund in late 2022.
“It’s quite a strong fund to be in and what I’m loving most about it is that advice is central to the purpose of the fund,” Gregory said.
“We had a decision made with the executive [team] and board last year…that one of the core capabilities would be advice and education because of our core belief in personalisation and the uniqueness of the membership that we also have within UniSuper.”
UniSuper’s advice team has 165 staff with $25 billion in funds under advice, and 36,000 members that have paid to receive financial advice.
“Advice in UniSuper is a big business,” Gregory said.
He said the increase in retirees – 3.6 million in the next 10 years projected Australia-wide, which includes one of five inside the fund – had been the driving force behind the fund’s model.
Gregory said it’s difficult for trustees to conform to the Retirement Income Covenant without the capabilities that sit around the delivery of financial product advice.
“That’s something we want to support because it helps us deliver on that broader policy agenda,” Gregory said.
The opportunity for the fund is what he described as the aforementioned “missing middle” – members of the fund that wouldn’t ordinarily seek paid financial advice.
“They’re often low-income, they’re often those that are looking for support around the complexity in our system – aged care, Centrelink is a good call out in that instance,” Gregory said.
“We’re seeing opportunities to be able to provide a proposition to those members and those that wouldn’t ordinarily buy the propositions in our traditional advised models.”
