No lies at the Daily Telegraph:

Ted Sheil writes: I was Daily Telegraph Chief of Staff in 1963-66, so presume I am the person involved in the confrontation your unnamed correspondent depicted in your Tips and Rumours (July 25 item 8) item headed Tele Under Packer: ‘what lies’?.

I have no memory of such an encounter, and certainly not one as dramatic as described by your correspondent.

As part of my job I often discussed, or even debated, approaches to stories, especially among younger staff members with as little or less experience than your correspondent seems to have had at the time. (The same goes for choice of assignments, e.g. a young man who was one of those days’ rare breed, a university student. He thought after the first few months of his cadetship he should be transferred to Canberra to report and comment on federal politics in partnership with Alan Reid, rather than waste time learning to cover lower courts and municipal councils.)

There were, naturally, occasional disagreements. But I certainly never ordered, suggested, hinted, cajoled or condoned any reporter lying. Rather, there were occasions when the opposite was true. And, just to set the record straight, my name is “Ted”, not “Bill”, and “Sheil”, not “Shields”.

Remember the first rule of journalism, dear anonymous correspondent? “Always make sure that facts and persons’ names are absolutely correct.” And that goes double if you’re denigrating someone.

Financial planners:

Financial planner Tim Mackay writes: With regards to the Future of Financial Advice reforms, Wally Fryer (Friday, comments)  asks us to “Think about (his) business”. No Wally, the focus of these reforms is not about your business and nor should it be. The reforms are about better protecting consumers and driving professionalism in financial planning.

As financial planners we, like many of our colleagues, have business and revenue bases to protect. But as younger financial planners — with 25 years-plus ahead of us in the industry — it is short sighted for us to focus just on current revenue protection. Industries evolve and the government’s Future of Financial Advice reforms are a solid start towards developing the professionalism of financial planning.

The opt-in requirement will ensure consumers are more actively engaged in their finances, which can only be a good thing. Every two years consumers are prompted to consider whether they are receiving true value for money for the fees they pay. If they do not feel they are receiving value for money, then they can stop paying. Advisers who rely on passive income streams they have either bought or built up over many years, which are still paid by inactive clients, will find this reform difficult to implement. Those advisers rightly fear they will not be able to convince inactive, yet fee-paying, clients to sign an opt-in notice.

Opt-in will drive the professional shift from sales to relationship-based financial planning. Advisers who are actively engaged with their clients and already show they are providing value-adding advice will not find this reform changes their business in any material way.

Life insurance commissions should be banned in and out of super. Wally claims the insurance companies pay commissions and implies that it is somehow free to the consumer. Is he seriously asking us to believe the consumer does not pay for commissions in the form of significantly higher premiums? We estimate commissions add 43% to the price of consumer premiums.

Commissions are a lazy way for professionals to charge fees. It is human nature that people don’t like paying upfront fees. However, financial planners should proactively justify to consumers that our advice services are truly value-adding and worth paying for. Consumers are not better off paying commissions, which are, essentially, hidden fees. Ignorance is not bliss.

Adam Barker writes: While I agree with Wally Fryer on the Industry Super Funds, in many cases, the large corporates and retail funds aren’t much better. I’ve worked in the industry for years and have seen it with my own eyes. Most people’s super balances are held in Managed Funds held inside a highly standardised “service”, which are really products. The financial planners selling these funds don’t even know what the underlying investments are.

While I agree that part of the article was biased against financial planners, it was with good reason. So many in the industry are doing nothing for their clients but sitting on a pile of trail commissions much like mortgage brokers do with home loans (just as big a problem in my book) — income for jam

Something tells me this won’t be the case with many of the planners who are critical of this new “opt in” piece of legislation because trying to enact this with clients (and I use the term loosely) will be difficult. The reason is most have never met their “clients” before, as they were handed to them, or purchased off a roll of “dormant” clients, or, they signed them up years prior, charged them an upfront and a trail and put them to the sword as it were.

I have seen some planners with 800 clients they never contact, and if they do, they only cherry pick the ones that reach a certain age to “offer some help”. That usually means using a standardised, charging a hefty fee for the document that outlines it, and sending them on their way again. This advice can be beneficial, but, for most people, the benefit is negligible and when the charges for providing it are taken into account, the clients can end up worse off.

If you really wanted to provide a service, you would have your clients come in once every two years (at least) and sit down with them for an hour and show them what you have done for them with regard to their investments and their financial plan. Then, once they are there, you would get them to sign off on the fees you will charge to continue to provide this service. If they are happy with the service you provide, this won’t be a problem.

Meeting your clients at regular intervals is what a half decent financial planner will do. The face time will help build your business and your relationship with your clients, and who knows, for actually providing this service you may be able to justify an increase to your fees.

There, I solved your opt in crisis and helped improve your bottom line. That’s my advice — I won’t even charge you for it.

An NBN killer?

Andrew Fry writes: Re. “‘Impossible’ new wireless tech an NBN-killer? Not quite, not” (Friday, item 4). I read your “DIDO” article in Crikey. First, a hint of authority — I’m not a radio engineer, but am I am bona fide computer scientist. As you noted, there have been plenty of miracle network solutions over the years. And like those, this one really looks (way) too good to be true. (I imagine someone somewhere is being conned — but it’s anyone’s guess exactly who.)

Some technical points:

  • The DIDO idea (sort-of holograms) may have pluses but no way will it provide additional bandwidth. I imagine, with considerable effort, DIDO might be able to demonstrate bandwidth X for multiple channels (e.g. at each receiver/access-point), but to transmit the multiple channels (even using multiple transmitters) still requires more overall bandwidth than X (it requires NX for N channels!)
  • The white paper (perhaps deliberately?) confuses channel bandwidth with the bandwidth required for the combined signal(s).
  • The scheme described in the white paper utilises “internet” connections to access points, so the APs can co-ordinate signals. So how is this scheme going to replace internet connections?
  • The scheme (magically) works upstream, when transmitters are not co-ordinated.
  • The scheme described relies on carefully constructing signals for specific receiver locations — so it’s going to have problems with mobile receivers.

Technically, the first point is an absolute killer. The others just point to the scheme just being silly.

It would be nice, and it’s conceivable that I’m wrong, but I’m not waiting around, and definitely not investing in that goose — but thanks for the read.

US debt:

Ray Edmondson writes: Re. “Maley: hovering over a US debt trap” (Friday, item 18). Perhaps I’m just a born cynic, but while the standoff in Washington over the debt ceiling continues, and the world’s share markets  go into free fall, those with the cash have a wonderful opportunity to buy cheap stocks and shares before one side blinks and the market goes up again.

I wonder how many Washington legislators have taken advantage of the opportunity? I wonder how many had this possibility in mind before the standoff started?

Name popularity:

Jack Herman writes: Re. “Richard Farmer’s chunky bits” (Friday, item 9). In keeping with the “post hoc, ergo propter hoc” argument advanced by Richard Farmer about the popularity of Julia, Nick and Cameron, among others, after the election of eponymous office holders, I need to note that, since I became executive secretary of the Australian Press Council in 1994, the popularity of Jack as a given name has sky-rocketed, and it remains firmly entrenched in first place.

Pokies reform:

John Thompson writes: Anthony Ball, executive director at Clubs Australia,  is more than a little disingenuous in his response to Charles Livingstone (Friday, comments) .

Rational people, if playing pokies, are well aware that they are unlikely to win a jackpot, so they are unlikely to be unhappy with a $500 potential jackpot as they while away a pleasurable evening on a low-intensity machine, incognito from the point of view of government surveillance.

On the other hand, potential addicts, while desperate for that massive win, will be unable to mindlessly lose everything they own unless they deliberately set their limit at disaster level.

Most addicts regret their lack of control after the event. Pre-commitment simply allows them to make a rational decision (even if a foolish one) before the rush of the pokies excitement. If there is no likelihood of pre-commitment working, then why are Clubs Australia and their various spokespeople so concerned about loss of turnover? It’s not the low-key social gambler who is affected by this proposed pre-commitment card.

Brett Gaskin writes: Anthony Ball from Clubs Australia has some concerns about the proposed pre-commitment for problem pokies gamblers.  Fair enough too.  Let’s start with a few questions. Are you at all concerned that thousands of people put themselves and their families in awful positions through gambling addition? Is the misery of these people a small price to pay for the ability of the rest of us to have a cheapish schnitzel and chips? How did clubs survive before pokies?

Don’t get me wrong, the vast, vast majority of people can have a flutter on the pokies without any problems. But also don’t be mistaken, the vast majority of people couldn’t give a damn about pokies and would rather have the pub kitchen or live band area the pokies have taken. People playing the pokies often resemble a lobotomised production line. Anthony, how about you propose measures to help those problem gamblers, rather than childish comments about video cards.

Doug Melville writes: “Anthony Ball, executive director, Clubs Australia, writes: [that punters who register for a pre-commitment card will need to have their identity recorded on a government maintained database]. Of course they will, it’s the only way of preventing problem gamblers from registering for multiple cards.”

Good spot there, Anthony — except that currently all clubs in the ACT require a sign-up to be a member … and at that stage the club takes your details, and they insist on a form of government issued ID such as driver’s licence, passport, or proof of age card, that they then take the details from and put on their club system.

So who would you rather have looking after your personal details? (Including vital information that can easily be used in ID fraud, such as a licence number), a small club with no cyber security, or a government department with secure databases, IT security advisers and the Defence Signals Directorate security requirements managed in accord with the Attorney-General’s Information Security Framework.

I know who I would rather have looking after my valuable details, and in fact it is why I am a guest, not a member, at every ACT club I go to. I am not prepared to hand over that information, when it gets stored insecurely at the club and I have no guarantees about who gets access.