Lifespan advocates for extended experience pathway window

Amid the ongoing debate surrounding the experience pathway, Lifespan Financial has contributed to the discussion by submitting their input to Treasury, which has been recently published.

In it, Lifespan argues that the proposed window for determining 10 years’ experience (between 1 January 2004 and 31 December 2021) is not appropriate and should be extended to 1 January 2026 to align with the current transition period for existing advisers.

“We disagree with the notion put forward in the previous financial adviser education standards consultation paper August 2022, that advisers must have experience through ‘significant historical events, such as the global financial crisis (GFC), ensuring eligible experienced advisers have lived experience in volatile economic conditions’ as this would not be the case for new entrants or others that meet that the qualification standard,” the submission signed by Lifespan’s chief executive officer, Eugene Ardino, and compliance and general manager Eugene Serravalle, reads.

Furthermore, the pair argued that advisers who have entered prior to the GFC would have had less exposure to bad practices that have been largely stamped out since FOFA.

“Therefore we don’t believe there is a reason to require people with similar levels of experience to undertake more study just because their experience started later.

“In fact, it could be argued that more recent experience is more relevant and worthwhile as it is being done under a framework with higher standards.”

Finally, the pair stressed that maintaining both older advisers and younger experienced advisers is crucial.

“We would also suggest that while it is important to keep older advisers from exiting, it is equally important to keep younger experienced advisers who have commitments with young families from changing career paths due to onerous and unnecessary requirements.”

Speaking to ifa earlier this year, Mr Ardino said he is optimistic about the experience pathway moving into this next phase.

“I think it is great that the experienced pathway finally seems to be proceeding and we look forward to contributing to the consultation,” he said.

In the event that the experience pathway gains bipartisan support, Mr Ardino urged other licensees to be proactive in supporting their advisers who may need to identify which side of the requirements they lie on.

“AFSLs should be able to do some form of due diligence to help advisers assess whether or not they qualify,” Mr Ardino said.

This is particularly important since the exposure draft bill states that, “Australian financial services licensees are held accountable for authorising an ‘experienced provider’ to provide financial advice as a representative of that licensee”.

The experience pathway was introduced to Parliament mid-June.