Speaking to media following the company’s full-year financial results for 2015, Mr Meller said “around a third” of its advisers already meet the standards outlined by the federal government’s higher education and professional standards legislation.
This leaves two-thirds of the company’s current network of 3,657 advisers — down from 3,844 on the previous year — falling short on the proposed requirements.
However, Mr Meller said he believes the company will be able to bring all its advisers up to speed before the new standards come into effect.
“We are confident that we will be able to move the two-thirds that currently don’t [meet the requirements] to a position where they are in time for the introduction of the new standards,” he said.
Mr Meller also said he expects “modest growth” in the company’s adviser numbers, of which half will continue to come through the AMP Horizons program and the others to be directly recruited into the business.
He added that technology and automation will play a much bigger role in helping its advisers become more productive.
“When we look at our cash inflows and our cash outflows last year, both were down in a relative sense and that’s because we think the changes in regulation and advisers having to adapt their businesses… has meant that they have not had the same amount of time available to meet with clients,” Mr Meller said.
“So, our focus is very much on how do we design and deliver greater productivity and improvements to our advisers that they individually can see more customers than they can now,” he said.
This degree requirement has been a long time coming and yes is necessary, however the reality around forcing the ‘dinosaurs’ out is that many very good practitioners who have helped mums & dads for literally generations and have good relationship skills, will be lost as providers. Who is going to service that market? And before you argue that a lot of those clients don’t receive regular service for years (& I agree), interestingly when a client does come in with a claim or other crucial matter, those same ‘negligent’ advisers drop everything to assist.
This fracas is imbecilic; enforce education standards but allow a certain latitude for those who have been in the industry for a certain predetermined amount of time. Mortality and natural attrition will take care of the rest. And when there are only us degree qualified professionals left, it will be interesting to see how the level of complaints, bad advice or even fraudulent activities is affected – or not.
Haha Steve, just make sure you don’t lose your rose coloured glasses or you might be in for a rude awakening.
Plenty of horrible advisers that are not committed enough to the industry to actually put in 12 months worth of study to stay in it. It’s sad and the dinosaurs need to be pushed out.
Most of my time in the industry was without a degree. I am now a better adviser having done one. You will be too.
Roger that and reality. Why should I be burdened by your idea of educational standards.
If one person can prove to me education means better advice I’ll eat my hat. I know morons with a degree, I know advisers who dish out seriously bad advice and have a degree. Most of the storm advisers had a degree and all had FPA requirements met. It means absolutely nothing without experience or morals both of which you can’t study for.
Again, stop this pathetic circus and let this industry be the industry it is. There is nothing wrong with it. A few bad apples does not warrant this ridiculous fee grabbing course flogging mantra that keeps getting thrown in our face. Your degree is nothing but a bit of paper without experience, morals or talent.
[quote name=”spyforce”]I am not an adviser. My advice would be for the general public to get more education on investing and then make their own decisions[/quote]
You mean like selling after the market has fallen by 20% ?
@ Roger That
I am with you.
It has genuinely just dawned on me that only a grad cert would suffice. I did mine in a year while working fulltime. It is certainly much higher level education than DFP & ADFP but if your are an adviser worth a grain of salt you can get it done.
This for me makes the education standards and proposed timeline much more reasonable. If this is truly the case nobody has anything to complain about.
I agree on AMP though, they make it so every existing adviser needs to be CFP but the management genuinely has no idea how financial planning works most of the time. No different in many vertically integrated businesses.
@ Reality. My understanding is the same as yours.
I think our industry bodies are doing us all a disservice by the continual argument against what needs to happen.
Sure the changes are going to be harder for some than others but when are we going to make the break from being a cottage industry and become a profession?
Our industry bodies are stacked with some ( but not all ) smart people who have long and vested interests so why should we really expect them to support the changes we need. Our largest and most influential institutions, AMP is classic example, have their senior ranks stacked with people who have little or no experience outside of selling risk and building agency development loans ( OK a tad harsh but I think you know what I mean ) or bringing in bankers who can help with their cost to income ratios but 1/ don’t know how to blend that with the financial services and risk industry or 2/ are over-influenced by the existing isolated management.
It is an industry of conflicting and vested interests so how can we really expect those in charge to truly drive change for the future advisers.
I really wouldn’t want Meller’s problem either with all those longer term advisers, they will have to throw away their crayons and start using ballpoints!
I am not an adviser. My advice would be for the general public to get more education on investing and then make their own decisions
Amp has been the leader for decades in recruiting anyone with a heart beat and full focus on them being able to sell sell sell.
Now they want credibility? Their salesforce of veterans are ex mechanics, sales reps and experienced pressure closers & they wish to distance themselves from that now. This industry has not changed in what it needs. Honesty, fairness and good basic advice. Education standards are a distant 4th or 5th on the list. God help those in this industry survive this circus & again the poor client will pay for it under the banner of “fee for service” aka commission. More things change the more they stay the same.
@Roger That
Am I wrong? (genuine question).
From what I can read you need level 7 or higher. Simple as that.
But shouldn’t they be exempted from any requirements for higher education because they have proven experience over many years of being great sellers of AMP products?
yet in another IFA article it reads
WEALTH ARM BOOSTS AMP PROFIT. AMP has seen its full-year net profit rise 10 per cent to $972 million,
It’s great to see that FOFA & the FPA are doing their job and making sure the large institutions are making more money than ever while the fee-for-service independent advisor’s deal with the bureaucracy of it all.
Even if Reality’s reading is wrong he’s absolutely right that everyone should stop complaining and just get on with it.
Jeez I’m surprised the number meeting education standards is so low. I guess it reflects their long history and how they used to recruit their advisers. I really wouldn’t want Meller’s problem with all those longer term advisers, many who would own larger practices too. But then he’s also got a lot of long tenure one and two man shows across AMPFP and Charter which perhaps are going to be his biggest challenges.
Despite all the challenges of the new education standards they are a great opportunity for AMP to finally cut loose from the image of risk floggers and build a new perception in the eyes of the public.
I just read into the higher education standards further.. So you need to meet at least level 7 (bachelors degree)…
A graduate certificate is level 8… Anyone with experience can do this through KAPLAN without a degree and can be completed pretty simply in a year.
If it is actually as simply as that everyone all stop complaining…
No surprises there…