MFAA Chairman Cynthia Grisbrook helped lead a panel discussion at the 2017 ASIC Annual Forum, moderated by Stephen Sedgwick, AO, on the implications of ASIC's Review of Mortgage Broker Remuneration.
Grisbrook was invited to participate in the forum by ASIC and was joined by panellists Brett McKeon, managing director of AFG, Erin Turner, head of campaigns & policy at CHOICE and Anthony Waldron, EGM of broker partnerships at National Australia Bank. The panel was convened to discuss the implications of the review, including the important questions of whether current remuneration structures influence consumer outcomes, and if the evidence presented by the report really does support regulatory change.
Ms Grisbrook opened the robust discussion by reiterating that the MFAA would continue to work with ASIC and Treasury to ensure any policy was balanced, fair and equitable, and representative of the entire industry's interests.
Given the report had only been released three days earlier, the panellists and the moderator were still absorbing the detail. However, Ms Grisbrook was able to reassure the audience that the overall remuneration framework would remain in place for brokers, given that the report recommended minimal changes to upfront commissions over the next few years, referred to trail commissions as 'beneficial' and noted that trail commissions do not directly lead to poorer consumer outcomes.
Ms Grisbrook noted that while ASIC was critical of some elements of the industry's remuneration structure, such as VBI and 'soft dollar' incentives, it stopped short of implying there were systemic problems in the way that brokers were remunerated. Grisbrook promised that the MFAA would consult with brokers, aggregators and lenders as it engages with ASIC and Treasury, to ensure that the Government has accurate information from the 'coalface' as it seeks to formulate policy.