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Compensation scheme levy surge to cripple financial advice sector, says CPA Australia

CPA Australia

17 November 2025

Compensation scheme levy surge to cripple financial advice sector, says CPA Australia

• Dramatic increase in CSLR could see more experienced advisers quit
• Levy increase to make finance advice harder to find and more expense

Australia’s largest accounting body, CPA Australia, today expresses deep concern about the future of the financial advice sector following reports of a dramatic increase in the Compensation Scheme of Last Resort (CSLR) levy, which is expected to reach $127 million in 2027.

Driven largely by historic failures in the sector, this latest estimate is significantly greater than the $75.7 million levy confirmed for the 2026 financial year and would be six times more than ASIC’s $20 million cap.

In 2024, the levy placed on financial advisers was just $4.8 million.

“This is yet another disproportionate and punishing outcome for advisers who have acted responsibly,” said Richard Webb, CPA Australia’s spokesperson on financial advice.

“Legal and regulatory reforms in 2024-25 squeezed the sector already. Now these levy hikes could drive many more advisers out, just as Australians need them most.”

The number of financial advisers listed on the Financial Adviser Register has almost halved in six years, down from 26,500 in 2019 to about 15,300 as of July 2025.

Based on these numbers, a CSLR levy of $127 million would equate to about $8,300 per adviser.

Mr Webb says the CSLR funding model is broken and urged government to fast-track its review into the levy.

“The sector cannot go on like this,” he said. “Financial advisers are paying the price for failed products and individuals who have left the industry, leaving the rest to pick up the tab.

“Not only are professionals being let down, but consumers are also being punished because the increase in the levy will inevitably increase costs for Aussies seeking affordable advice.

“An effective CSLR must protect genuine victims without collapsing the whole advice system. We urgently need a levy model that is actuarially sound, legally capped and fair to today’s professionals and their clients.”

CPA Australia is a member of the Joint Associations Working Group – a collaboration of 10 financial services industry associations who share a common goal to make quality financial advice more accessible to the community.

About us:

About CPA Australia   

CPA Australia is Australia’s leading professional accounting body and one of the largest in the world. We have more than 175,000 members in over 100 countries and regions. Our core services include education, training, technical support and advocacy. CPA Australia provides thought leadership on local, national and international issues affecting the accounting profession and public interest. We engage with governments, regulators and industries to advocate policies that stimulate sustainable economic growth and have positive business and public outcomes. A CPA is a Certified Practising Accountant. Find out more at cpaaustralia.com.au

Contact details:

Simon Downes, External Affairs Lead, [email protected] or 0401 461 503