The Financial Planning Association of Australia (FPA) has reiterated its view that the competence obtained through experience should be better recognised in regards to adviser education standards.
In its submission to Treasury, the industry group has recommended that the government must not implement an experience exemption to the education framework.
The FPA also noted the government’s experience pathway, saying it alone will not achieve a reduction in the cost of advice. However, should it go ahead as proposed similarly to the Joint Associations Working Group’s (JAWG) submission, it recommended that those who can access the pathway should have 10 years of relevant experience, a clean record and called for a 10-year sunset period.
“The FPA believes unassessed experience alone is an insufficient foundation to meet the objectives of raising the minimum education requirements for professional financial advice providers and continuing to build consumer confidence in the profession,” the FPA said in a statement.
“Having surveyed its members to understand their views on the proposed modifications, 55 per cent of FPA members have already completed their required education and 35 per cent are on track to meet the existing education standards.
“Of those surveyed, 71 per cent of members meet the proposed experience pathway while 55 per cent oppose the introduction of the proposed experience pathway, and 73 per cent would only support an experience pathway if there was a sunset introduced.”
In a separate statement also released this week, the FPA welcomed a proposal to move to a principles-based approach in the Quality of Advice Review proposal paper released last month.
However, the association stated that the definition of “personal financial advice” must have the provision of financial advice “at its core” and not be based around product.
“It believes the regulatory costs of providing personal advice must help improve the affordability of advice for consumers by ensuring there is a level playing field for the regulatory requirements and standards imposed on advice providers,” the FPA said.
“Further, the regulatory environment should facilitate the provisions of simple personal financial advice to clients in an affordable manner by financial planners and financial planning practices, as well as non-relevant providers, to meet consumer demand.”
The FPA is a member of The Joint Associations Working Group (JAWG) but has now come out opposed to the recommendation made by JAWG below:
https://www.ifa.com.au/news/31832-major-industry-group-calls-for-experienced-pathway-proposal-to-include-sunset-clause
What is their actual position or are they getting splinters sitting on fence.
Either you are part of the JAWG or you are not?
Either you are part of the answer or part of the problem?
You can’t have it both ways.
Has anyone wondered why there are 13 associations?
Industry ones….not professional bodies.
And why all this discussion now?
Where was the push, the arguments, in the interest of all Financial Planners a few years ago?
Where was the push for self-regulation and setting of education when it was needed?
Why was the CFP the highest educational standard, yet many recipients were grandfathered?
Remember when the FPA changed the membership criteria that you had to have a degree to be a member?
So why isn’t the FPA pushing for the educational standards to stay as is given that most of its membership will meet the existing criteria?
Why is our industry always wanting a carve out or grandfathering?
Why is everything revolving around lowering the education standards?
Why can’t we strive to be a profession?
one more.
Given there is a set education pathway for advisers by the regulator, Why is CFP being promoted by the FPA? logic says another revenue source and again not working for the benefit of the industry.
I am sure that the whole saga will end badly again, as our industry voices still many differentopinions and we do not seem to be capable of forming one front in advising the government. If we all have a different opinion, and the various associations are not working together, how can we ever be perceived as professional??? The mortgage industry does a better job
Hmm an association that sells education (CFP Program) suggests further education is necessary….
There should be no changes to what has been previously legislated. If you dont like it, you know where the door is.
absolutely agree
I think we have to get away from this attitude that if I have a degree, everyone has to get one. The question must surely be does having a degree mean clients receive better advice. The rest is just noise. We just keep going around in circles.
No it doesn’t necessarily mean that. Just as years in the job doesn’t either. BUT we need standard qualifications across ALL advisers so that clients can confidently choose the best person to look after them. And for any adviser who has years in the job and a corresponding good record then are ahead of the bunch and can quite fairly say they are possibly a better client choice than a degree quaffed person with no experience. But experience only is not a qualification.
Agreed, but don’t we have that already with DFP?
I think I have been asked my qualifications perhaps once in over fifteen years by a prospective client. I have a Paraplanner and Licensee that checks my work to ensure it is appropriate. How far do we go? We make everyone get a degree because some have one already? I have seen no evidence to prove it provides a better client outcome. I have seen plenty of evidence that advice costs keep rising. Most of my work comes from existing client referrals. Once registered with ASIC, I think the client needs to take a view on this rather than constant tinkering of legislation and changing of goalposts. That’s what the market does isn’t it?
The ten year education exemption is uncommon common sense.
10 years up to 1/1/2019 for something that comes into play from 1/1/2026. In other words its a 15 plus years exemption
Empathy and Compassion are 2 key components of a good adviser.
For older advisers who have supported the FPA for the last 20 years this response has neither of these.
Once again the FPA has taken a stand that just ignores my rights.
In the merger webinar you said you were here for members…well i am a member…an over age 60 mermber with a CFP, DFP, clean record and years of experience being ignored and discriminated against.
I may not be Professional in your minds but my clients and i are comfortable with morals and ethics and skills.
No problem with a sunset clause, it provides an exit with dignity.
Good old FPA jumping on the bandwagon late and taking an each-way bet. Advisers deserve better.
With the exception that half of the “approved” degrees some of the “fully qualified/fully educated” advisers took advantage of have zero connection to Financial Advising.
71% of members but what has the membership base dropped to. The FPA is about the FPA first, the consumer second and the adviser last. The adviser gets to pay the bill for all three.
Thank you FPA! We can’t have a handful of advisers in the way of calling ourselves professionals.
Well said.
I’m a professional already. I don’t need CFP after my name to prove it. You think that’s the defining criteria? We are all in Fairy Land if you do. It’s about the advice and service you provide. You can judge it no other way.