Thank you Andrew for your wonderful introduction.
Welcome to beautiful Melbourne. It is with great pride that I open the 2017 SMSF Association National Conference. Our national conferences provide you with a wonderful opportunity to learn, network, have fun and build your businesses.
It is our great privilege that, for the first time ever, an Australian Prime Minister will speak to our Association, via video address. It is a recognition of the importance of our SMSF sector.
I also welcome the Hon Kelly O’Dwyer, the Minister for Revenue and Financial Services, who will deliver her special address on Friday, Senator Katy Gallagher, Shadow Minister for Small Business and Financial Services, and Bill McNabb, Chairman and CEO of Vanguard.
Our Patron, Sir Anthony Mason, will also provide a video address and apologises for not being here due to family illness. As always, his message will be challenging and inspiring.
Today marks the 10-year anniversary of Sir Anthony’s service as our Patron. He initially committed to our Association in the belief we could change the landscape of SMSF advice. Throughout his tenure, he has provided us with great wisdom and guidance, all the while challenging us to improve. We thank and honour him here today for his 10 years as our inaugural Patron.
I sincerely thank our sponsors whose commitment to this event, the biggest drawcard on the superannuation calendar, makes it all possible. In particular, our Platinum sponsors Vanguard (who hosted this morning’s Thought Leadership Breakfast), Colonial First State, hosting tonight’s ‘Slice of Victoria’ welcome reception, Schroders, hosting tomorrow’s night’s Explore Melbourne networking night, Class hosting the final day lunch, and BT Panorama hosting the Delegate Networking Lounge.
Our Premium, Valued, Product, Education and Media sponsors and their ongoing commitment is also greatly appreciated.
Please take the time to visit all their booths. It will be a very valuable experience.
As this is my final conference as your CEO, I want to express my heartfelt thanks to you all. It has been a privilege and honour to be your CEO for the past 14 years and I have been overwhelmed by your kindness since our announcement. Your dedication as members has always been my inspiration. To see where this organisation and the SMSF industry has come from is nothing short of amazing. Long may that dedication continue.
As you would be aware, I would not have handed this position over to anyone whom I was not totally confident that they would continue my legacy. John Maroney is that person. I know you will all embrace John as you have me as your CEO.
The theme of this conference is ‘trust’.
The premise of superannuation relies on trust in the system and trust in the government to protect Australia’s primary savings vehicle. Stability of legislation and consistency of policy. This is why we strongly support enshrining the objectives of superannuation in law, and why we are so adamant that the objectives must strive for dignified and secure retirement.
Also, consumers need to be able to trust that the advice they receive from their advisors is accurate and in their best interest.
Today I want to focus on three main points.
First, I will briefly reflect on our significant achievements as an Association since establishment in 2003. Second, I will discuss ‘professionalism’ and last, I will touch on the tremendous opportunities that we have at this time.
Fourteen years ago, very few understood the SMSF sector, let alone its role in our nation’s future prosperity. Its survival was hanging in the balance and desperately in need of a ‘leader’.
It is now the largest sector in the superannuation industry. Since those dark days in 2003 when SMSFs were under real threat, the sector has had six-fold growth in funds under management and more than doubled in the number of funds. These are phenomenal statistics and something which each of you should be immensely proud. It is your doing.
Predictions by Rice Warner in fifteen years’ time have SMSFs continuing to be a standout leader in Australian superannuation doubling again in size and numbers.
As a direct result of the SMSF Association’s contribution to that growth:
Today, SMSFs are now integral to our superannuation system and national prosperity. They are too big to ignore.
The growth, and the importance of SMSFs and their communities can be tracked directly to your Association and your input.
Despite at time significant headwinds, we have never wavered from our Vision “to enable Australians to take greater control of their own destiny through a sustainable SMSF community”.
Our Mission has always been to ‘lead the professionalism, integrity and sustainability of the SMSF sector’. These enabled us to navigate the constantly changing environment in which we exist professionally.
There is no better example of this than last year’s far-reaching changes to superannuation in the May Budget.
Our strong advocacy ensured that concessional and non-concessional caps were not further reduced.
We maximised the benefits of the new rules, particularly for women, and SMSFs are now the best placed to adjust to new laws such as the $1.6 million transfer balance cap and flexible contribution rules.
And this leads to my second point.
The word “profession”, at its core, it’s an indicator of trust and expertise.
A ‘professional’ is someone who is independently qualified by a recognised body, governed by a code of ethics, committed to excellence, integrity, professional development and the promotion of the public good within their expert domain.
While we have advocated strongly and you have personally committed as a professional, we have left it to others and government to determine what our profession really looks like. Too often in the past, parts of our industry preferred to pull back towards the lowest common denominator instead of making the tough decisions to move forward into a new professional era.
Often fear, costs and efficient systems design were reasons for the focus on products instead of people and the building of a profession.
It is time to take control.
Research shows trustees number one motivation for being an SMSF trustee is control.
You, our members, are early adopters. But now as role models you must demand your peers and others in your supply chain join in the journey. Help them commit to their learning journey and membership.
I challenge you now to take control of your profession. I challenge you to be a leader.
It is your responsibility to continue building the profession by bringing everyone in the supply chain into your professional community, whether it be at the entry administration level or the elite strategic advice level. You should maximise and leverage opportunities at every level of your business.
Don’t settle for mediocrity because it is safe or what the government sets a baseline for you – be the cornerstone in creating your future profession. Take a good honest look at the opportunities before you.
You need to want co-regulation. Create a professional legacy for others to follow.
Raising competency and knowledge is not easy, nor is it quick, but it is necessary. To create trust, you, as advisors, accountants, auditors and administrators, must maintain standards expected and demanded of professionals.
It is absolutely necessary. To think otherwise is delusional. Truly professional advice will create trust with your clients. It will help them make better decisions.
It will lead to a better outcome for you and the SMSF industry.
It will set you apart in a crowded market.
To my last point, the future is in our hands and the opportunities held within that future are enormous.
Your clients have never been in greater need of your trusted professional advice.
As I mentioned, last year’s budget changes have provided the SMSF sector with unexpected but significant advantages, which if understood, can add such significant value to your clients. There has never been a better time to engage and build trust and confidence.
I know that due to the complexity of SMSFs, you as advisors will have opportunities to add meaningful value well into the future.
Technology and digital innovation will create new tools to assist those who commit to their own future professional development and help them stand out.
I also believe future advice will be part technology and part human. If you look to the US market you see the growing need for advice in retirement implementing a hybrid advice solution.
You and your peers are absolutely necessary to the SMSF industry, but the future will not again tolerate a product story.
You can be leaders.
In fifteen years’ time, just imagine what the industry will look like to efficiently advise, service and invest in the predicted $1.2T of funds under management in SMSFs.
We must all continue to demonstrate that SMSFs can be a vehicle for people to take control of their destiny.
Others in our super sector are threatened by the power of SMSFs.
They continue to oppose us.
Others claim to be run for the benefit of members. SMSFs are run BY the members.
As your representative Association, we will continue to engender integrity and trust for consumers and government in this sector. It is critically important that we maintain and further develop a highly competent, well-regulated, competitive SMSF sector.
I am confident you will meet these challenges and opportunities in all their different forms. You have done so in the past and will continue to so, knowing 1.1m people have already placed their faith in us and knowing that this figure will also double.
We cannot let the future SMSF Trustees down.
John F. Kennedy said in 1962 about why it matters to go to the moon: “We choose now, not because it is easy but because it is hard…..this challenge is one that we are willing to accept, one we are unwilling to postpone, and one which we intend to win.”
We are ‘flying to the moon’ to achieve our future as professionals who are trusted by Australians.
I have trust in you.
I know you will accept this challenge and I know you will win.
Enjoy the conference and utilise the opportunities it will provide you to become a trusted advisor and get others to join your association.
Be proud of where we sit as an industry but be vigilant to ensure the SMSF industry fulfils its potential and its place in the Australian economy.