In its submission to the Australian Law Reform Commission’s (ALRC) Review of the Legislative Framework for Corporations and Financial Services Regulation, the association said it supports proposals to make financial advice law and regulation simpler through a consolidated “rules book”, but highlighted the challenges planners are constantly faced with.
“The financial planning profession doesn’t need more regulation, it needs better regulation,” FPA CEO Sarah Abood said in the submission.
“Financial planners are required to interpret a never-ending list of contradictory requirements placed on them. To ensure compliance, planners are required to comply with four laws regulated by eight regulators with additional oversight from Australian Financial Services Licensees and professional associations and additional consumer complaint mechanisms through two ombudsman services and the courts.
“This all comes at the cost of providing clear, concise, efficient and affordable advice to ordinary Australians who need it most.”
Ms Abood said this also creates concern for advisers as compliance requirements under one Act and regulator can differ from others leaving them at risk of breaches.
She added that the complexity with financial services law is also confusing for consumers to understand and therefore trust and engage with the sector.
“Broadly, the FPA agrees with the proposed structural amendments suggested by the ALRC which are intended to reduce complexity in corporations and financial services legislation,” Ms Abood said.
“We strongly believe that the language and structure of the Corporations Act must be improved to allow everyone – including consumers – to better engage with the financial services sector.”
The industry is no longer in control of itself. It’s madness.. being controlled by bureaucrats who have no idea of the practicality of the rules!
FPA is a joke, too little too late and only moving now because everyone us leaving them as they have completely dropped the ball
The FPA has finally disabled the SNOOZE button, albeit a decade too late! Noticeably after their financial masters have all exited the scene. Hmmmm…
Well here’s a bit of “lateral controversy” Gary – What about the FPA membership being exclusively for practicing Financial Planners. Isn’t it the Planners the FPA represents? OK there may be loss of financial support but that may require a leaner Association.
Peter CFP from Perth
Agree, but that is not far enough if we are to be a profession. Make it for only Fasea Qualified advisers only.
The FPA then needs to work out where CFP fits.
The CFP Certification Unit (CFP 5) is actually a higher standard than qualifications required by FASEA. So there is a clear potential role for CFP as a peak professional standard. Similar to the relationship between CA and an accounting degree. Or medical specialist designations and a medicine degree.
Unfortunately the grandfathered CFP is a much lower standard than FASEA. It is also a much lower standard than reasonable community expectations would have had for a professional association at the time it was introduced. It was a total sham that lingers on and continues to detract from the credibility of the CFP and the FPA as a whole.
The FPA needs to kick out the grandfathered CFPs once and for all if it is ever going to become a professional association.
I 100% agree with you
The problem with grandfathered CFPsis so bad that you can’t trust ANY CFPs
There is no absolutely way for consumers to tell them apart so just avoid them all
We should all just keep complaining about grandfathered CFPs until no one trusts any CFPs
Then we will all be recognised as professional
The FPA is no longer relevant or ‘up-to-speed’ with the demands and requirements of Financial Planners. The FPA meet it’s used by date post the Royal Commission. No longer can the FP Association take money from institutions and pretend they act for FP. It’s an unreconcilable conflict. It’s time the FPA bowed out (dis)gracefully.
Every change I’ve seen in 15 years of financial planning has been done with the focus on making advice easier to provide. Everyone of them has also failed miserably. What makes anyone think that this won’t just be another box ticking exercise which will make it even harder to provide advice to a client?
I would respectfully suggest that many of the changes have had the STATED goals of making advice easier to provide – I believe that in many cases, the STATED goal was different from the actual goal.
Jane Hume and Josh Frydenberg are a significant part of the problem. They have imposed new taxes and more red-tape.
They have presided over this and compounded it – “planners are required to comply with four laws regulated by eight regulators with additional oversight from Australian Financial Services Licensees and professional associations and additional consumer complaint mechanisms through two ombudsman services and the courts.”
Not a bad start Sarah. But please have a good chat with the Pharmacy Guild and the Minerals Council, so they can give you a thorough crash course on how to make politicians into lapdogs.
The industry must actively campaign against politicians who seek to harm it with more idiotic, pointless legislation. They always seem to get the message when they’re at risk of losing their seat.
Good direction Sarah, you have my support but will they listen and act? You may need other groups’ support. Why does one have to complete 2 fee consent forms via Netwealth (OFA plus a separate consent form) ? Or a verification code to login into Perpetual each time ? even the mechanics of servicing are bloody ridiculous.
How about trying to quote on revising existing insurance cover for a client or dealing with some of the industry funds. Admin required to tick the box for compliance and admin to implement advice recommendations is horrendous and not improving.
The FPA has never represented the interests of individual FPs – just there institutional sponsors. They have contributed to the current parlous state of affairs.
isn’t this proof of the FPA’s failure to influence successive governments to support advisers?
Statement of the year.