According to a statement, the Corporations Amendment (Professional Standards of Financial Advisers) Bill 2016 includes compulsory education requirement for both new and existing financial advisers, supervision requirements for new advisers as well as a code of ethics for the industry.
The bill will also mandate an exam that will represent a common benchmark across the industry and an ongoing professional development component, the statement said.
The new professional standards regime will start on 1 January 2019, whereby new advisers entering the industry will be required to hold a relevant degree.
Existing financial advisers will have access to transitional arrangements allowing them two years, until 1 January 2021, to pass the exam, and five years, until 1 January 2024, to meet the education requirements.
The government said it will also establish an independent standards body to administer the new regime.
From the date of establishment until the regime begins on 1 January 2019, the body will be responsible for developing and setting the industry exam, developing the code of ethics and setting the education requirement, including working with education providers to establish appropriate courses, the statement said.
The body will be funded, both initially and on an ongoing basis, by the industry.
“The current requirements have allowed some financial advisers to become qualified to provide financial advice to retail consumers after only four days of training,” Ms O’Dwyer said.
“There is also no specific requirement currently for advisers to undertake continuous professional development.
“The government’s reforms will significantly increase the education, training and ethical standards of financial adviser, who will need to be qualified to a standard equivalent to a degree.”
[quote=Roger Smith]What a cop out! Perhaps you need to change your Employer. I can recommend a great Licensee who does not stifle “free speech” if you want to change from being a “no name” brand to a “real brand”.
[/quote] Id say he changes his name to “Look at me , look at me!
How dare someone have an opposing view and actually want to raise the standards of the industry!
Yes, “Look at me, yes look at me” how dare you have an opposing view and want to raise the standards of the industry! I. like many of my colleagues say if it looks like a pig and it smells like a pig then it’s a PIG! All your trying to do is drive your own agenda and profess to wanting to raise the standards of the industry! Pffft
[quote=Roger Smith]What a cop out! Perhaps you need to change your Employer. I can recommend a great Licensee who does not stifle “free speech” if you want to change from being a “no name” brand to a “real brand”.
[/quote]
Thanks for the offer but I am fine thanks mate. Id rather stick around at a place full of adaptive advisers in it for the long term as opposed to those stuck complaining about every little change…
The industry has been a farce for much of your 49 years of experience. The sooner we get away from that, the better.
Regulations that mandate the character of instruction only serve to silence demand and prevent entrepreneurship and innovation. The educational base across the financial services sector should be allowed to be as diverse as the population itself.
I was under the impression, with regards to the exam, that there would be an experience concession for those that meet the education requirements and have a minimum period of industry experience?
I find that when speaking to my clients, my experience holds a lot more weight to them than my qualifications. During my introductory spiel, generally when I go into my working history is when my client’s shoulders drop and they sink into their chairs. Not my qualifications.
I’m a reasonably young Adviser, and I look younger than I am so a lot of my older clients ask for my age, not out of curiosity but because it’s a simple and conservative measurement of possible experience.
I am not overly concerned about the minimum education requirements, I am more concerned about how the Government plans on measuring the success of this bill. And at what point will they deem our occupation as an official “profession”?
Ha , ha ,ha good work boys ,. Who needs to be a CFP , pay their annual fees etc , just get a degree , as per government requests. the FPA will soon disappear .Of course no one with a degree will rip of clients will they ? solicitors and accountants etc ??? Are they kidding themselves ?
So as I have two relevant degrees, BCom and MBA, I already meet the professional standards. I should then be exempt from the draconian regulation designed to make purportedly un-professionals behave like professionals. My dentist, doctor and lawyer do not provide advice in any form like an SOA and usually only verbally. I want to be a professional like them. I am educated, a man of good conscience, who acts ethically in in my clients interests.
This was obviously coming for a long time so it wasn’t difficult for me to complete my Masters over the last few years while everyone else was busy complaining. This was while working greater than fulltime hours and sporting commitments most nights each week.
Those saying that they shouldn’t have to do this due to experience will just breeze through the study if your knowledge is actually that great. Thing is, you will definitely learn something.
I would however have no problem with watering down the education standards if they made this exam extremely difficult, closed book and classroom based. That way you can really separate the truly knowledgeable advisers who are experienced but may not have many qualifications from those who have been around 20 – 30 years and just buy and churn through books (what got us to this point in the first place) with a DFP/ADFP only and a paraplanner to teach them what a TTR is each time.
It’s a amazing “Reality” that being so highly qualified you never learnt how to spell your name!
Roger, I actually wasn’t “so highly qualified” until I used the time that you have spent complaining to complete a degree.
Your comment has proven my point though. Let me guess, you only hold a DFP and/or ADFP yet have been in the industry 20/30 years?
Interesting! My comment was NOT a criticism of your educational qualifications which you are to be congratulated on. It was a criticism of your inability to stand up and be counted by using your name. Yes, you are almost correct except that I have 49 years Industry experience and that’s not one years experience 49 times. I have NO problem in terms of the new educational requirements but I have a problem with Advisers (if you are one) who don’t name themselves. Can you please explain why?
Quite simply I remain anonymous at the request of my employer. While they do not disagree with what I voice much of the time, they would prefer to maintain a neutral stance.
What a cop out! Perhaps you need to change your Employer. I can recommend a great Licensee who does not stifle “free speech” if you want to change from being a “no name” brand to a “real brand”.
Reality- You sound like an qualified failure- if you are so good why do you need an employer- join us who are equally qualified yet own our own AFSL, (yes it takes smarts to run one correctly but its not hard) and in case you need to know I have 32 years experience and like Roger, that is not just 1 year 32 times, however, if you need an employer you are not up to the level of those who dont so you still have a long way to go, I just hope you are not one of those “bank Advisers” we read so much in the papers, who run around promoting the latest active managed fund based on the “we will beat the market” brochure yet you really have no way of managing the outcome so you simply say “you have 20 years nothing to worry about, it will come good”
Its not just a circus – its an absolute farce and it has me wondering why I’m so naive and honest when my professionalism is constantly questioned by people who have ZERO understanding of what goes on inside a risk advisers business, despite how I conduct myself. We are constantly GUILTY now until proven innocent.
* How can any Government report that scanned the behaviours of less than 1% of the total adviser community be used as the foundation for a monumental reform package to begin with? And even that data was handpicked and not random;
* We have Insurance company management, who operate under far greater conflicted internal remuneration structures than what advisers are accused of each day who have turned on the very advisers that gave them the cushy incomes they now earn, when good business sense should have identified the rats in the industry years ago and banished them altogether. But no, lets blame advisers instead they say;
* We have a regulatory body that’s very clearly looking out for its left-wing Industry Superfund buddies now instead of focusing on the bigger picture and REALLY focusing on Australian consumers’ best interests;
* We also have industry bodies that have overlooked their own conscience for the sole purpose of absolute greed (FSC). Aaah reminder – there’s still roughly 70% of Australia’s population that’s under-insured! How about focusing on doing a good job with that first before manipulating an entire industry for your own greedy members;
* We have politicians who have chosen to use legislation to further their own political careers instead of acknowledging the FACTS that have been repeatedly presented to them for the last 12-18 months? If they’re as bright and intelligent as they want us to believe they are, why can’t they see that they’ve been absolutely conned by the above mentioned colluding parties (or is it bought?);
* And now, we have another smoke screen – higher education standards that still won’t guarantee unethical behaviour stops with poor advisers as a result. It’s often the most educated people who manipulate the system; not honest hard working advisers with 5, 10, 20 even 30 years of experience.
Yep….it’s just laughable now what’s happening to this industry and I just can’t fathom how its been allowed to play out like this.
Professions require a standard (minimum) the Government is going to set one. For those in the industry who have not yet completed or started to meet that standard, one simple question: How much for your business? The industry will become a profession that’s a certainty, will all the current members make it, no unfortunately that’s a certainty. Should Risk or Investment focus be treated differently, no that’s also a certainty. Where are you headed?
So, 30 years in the industry, 12 with my own AFSL, various qualifications over the years, but apparently no degree means I’m not competent to continue. How, as a single parent and running my own business am I meant to also find time to do a degree? Qualifications are not the answer. Accountability is the problem so focus on that.
feel for you Andrew. I’m 28 years. But the writing was on the wall in the 90’s to become a CFP and I started it then and completed in 2001. A very large commitment then in time and one I would not do at this time in my life had I not yet completed this.
And what will this exam look like “a one size fits all” is my guess so those risk specialists will need to brush up of their planning skills and vice versa. It a bit like a Dentist needing to pass an exam on Organ Transplants – How absolutely crazy. When are we going to see some “commonsense” or has that totally disappeared.
I am not for or against the degree qualified issue. Personally, I don’t think it will make much difference. However, I am very much for a LEVEL playing field. So, whilst the government is bring in these educational requirements for the Financial Services Industry and Financial Planners in particular, I think they should also bring in the same rules for Politicians and they should also have educational requirements both to be a Politician and also they should have some requirements related to their portfolio.
and the real estate industry. So many of them seem to be labels as financial advisers.
I’m a new adviser and trying really hard to be the best adviser for my clients. The worst thing about the industry being a circus, is it makes ‘good’ advisers jump off the ship because they are sick of all the unknowns and general ‘negative’ vibe of advisers within their own industry.
So having a degree doesn’t make me corrupt or unethical, that’s where the problem lies. Oh and politicians warranting their existence and trying to look like they are the saviors of the little people.
To all those who don’t like the changes, that will come into place, then leave the industry you have enough time to look for a second career.
Do I agree… No I don’t, and i am more educationally qualified than most people currently on corporate boards or Politicians. But, it will be law we therefore have to comply.
Well, the Government can’t get unemployment numbers down, so they have just create another cottage industry to help them. More money paid to the Government for legislative requirements, that apply to those on the coal face, yet there are still exemptions and carve outs for Funds not to provide SoA’s when rolling super money to themselves. Wonder if they also got an exemption for their planners?
We have a Minister totally out of her depth being led by the nose and not doing her own due diligence, just the sort of inept person we need as Minister for Revenue
I agree Steve… the industry is a circus and I cannot see how this will really change that fact. Time will tell.
totally agree. doing CPD each year counts for nothing.
its how the client is looked after that matters. Having all the degrees doesn’t mean much, just look at the planners that are getting caught, they are degree qualified to the point it is stupid. what has that done for the industry. Nothing
Sorry I was under the impression that I needed to do 60 hours of TASA and 40 hours of CPD each year ??????
You are, but there is no punishment for non compliance, no mandatory reporting of those CPD points nor any way for the regulator to track them.
Then try not meeting your training and PD obligations with my Licensee John! You’ll get a severe reprimand and probably lose your authority to practice as an adviser with them. We are constantly reminded of our obligations so I don’t buy that argument one bit.
About time
Any dill can go get a degree, do your adfp & meet these requirements. Experience and track record are everything. End of story. This industry is a circus, fact.