Speaking on a recent episode of the ifa Show, adviser Nathan Fradley said the new class of advisers that will be introduced by the Quality of Advice Review (QAR) reforms could be an opportunity for the industry, rather than a threat.
“It could be a really positive thing to get people into an industry which now has a very high bar to enter, and enable them to get some experience,” Fradley said.
“There’s a huge opportunity in this. It’s not an us and them, or it doesn’t have to be an us and them.”
He noted that the lower benchmark for entry could bring more professionals into the industry and they could be built up to provide higher standard advice down the line.
“They can then help service those clients to a lower threshold, identify the opportunities where that person needs more comprehensive advice, but then allow them to build the skill sets within those roles to progress upwards as well,” Fradley said.
“How many advisers out there started off working at banks or large financial institutions, giving really narrow or scoped advice, who were then able to build the confidence and the skill set to do more complex things?
“I think this role gives large practices the ability to hire people at a lower benchmark in terms of qualifications, ironically, but the PR around it is shocking. It’s never delivered well.”
Determined to see the bright side to the massive shift in the financial services industry in recent years, Fradley said the quality of advice in Australia has improved significantly due to changes that have been made.
“The quality of advice in the last couple of years has increased exponentially. The connection with people. We’re world leading when it comes to the kind of advice we give. If you look at other countries, they’re still stuck back 20 years ago,” he said.
“And so if we look at that, the better we do, the more strength we have to start pushing back on further regulation as opposed to just self-regulation. And when we do that, then we’re in control of that a lot more. But I might be being optimistic.”
Speaking on the fears expressed by some industry members that increased regulation and the introduction of the new class of adviser by the government is part of an effort to push advisers out altogether, Fradley said he understands where these fears are coming from.
“The question that comes about is, you bring in this new tier of adviser, are the same costs put on them or is this a different playing field? I can understand where that fear would come from, that it’s like we’ve got this new type of adviser,” he said.
“If you keep getting pricked by little things all the time, of course you’re anticipating the next thing that comes lobbed to you to be a prick in the shoulder or something. I completely understand why people would feel that way.”
Fradley added that it can feel as though the financial industry can be treated like a political pawn by those in government.
“Sometimes it does feel like we can be a bit of a political plaything, which is, it’s easy to move,” Fradley said.
“It doesn’t take much effort to do something in financial advice and be able to say you’ve done something great, or at least just taken any action at all, whereas a lot of other industries are a lot larger and harder to move.”
How about they start by getting rid of the HOT MESS of mass over compliance and Red Tape for Real Advisers.
How about they cut the Gordian Knot of rubbish Red Tape costs for Real Advisers.
If Real Advisers can have 75% less Red Tape they can service 3 times, 4 times more clients and solve a huge chunk of the Advice gap.
How about that before resorting to Back Packer Call Centres Flogging Single Product Sales that are call Qualified Advisers.
Yes, this would have been the non-political outcome of the QAR. Streamline compliance, so that advisers can service more people and at the same time build the pool of qualified new entrants. Instead the government is recommending unqualified, conflicted advice, which is essentially about retaining FUM.
I represent the international back packer society and not sure why we are always being referenced in call centres at super funds.. We just want to go on a holiday on the cheap, not work…
But after 2 days Super Sales training and drinking at the Industry Super MCG corporate box, will then lead to significant Back Packer Sales Commissions to fund more Red Bull Vodka fuelled holidays 🙂
I remember a time when the words Financial Adviser were going to be enshrined.
IFA please stop calling them “qualified advisers”!!!
It legitimises an appalling proposal that hasn’t been implemented yet, and needs to be pushed back against at every possible turn. Call them what they are… “restricted advisers” or “product consultants”. The last thing they are is qualified.
This is the second IFA article in a couple of days by different authors that has made the same mistake. Where is the editorial oversight IFA??
This must be a joke. With industry funds, it is always us versus them. They built their business on attacking financial planners. Anyone who thinks they will play nicely is kidding themselves. The unqualified Qualified Advisers will be sales people. Attracting FUM and retaining FUM will be their sole focus. Indeed it MUST be their focus, or else they will be violating the Sole Purpose Test.
Nathan appears to be a half glass full type of person that sees an opportunity in this for advisers.
I think the industry super funds and insurers see a far greater opportunity with “qualified advisers” provided by puppet master Stephen Jones for themselves…
You don’t want an us and them mentality do not legislatebthe segregation and massively different rules for each
Dilutes the value and importance of existing education experiential and code of ethics standards. Much like intra fund now, constant examples of over stepping and not mirrored in other professions. Should NoT be called Advice or adviser these are vertically integrated sales reps
When “us” can be paid the same as “them”, with no ANNUAL Fee Renewal Consent Form Red Tape (that don’t exist in any other nation on earth), then we can have the discussion. Until then, “them” are definitely not “us”. “Them” are vertically integrated “conflicted & restricted” tied agents, and “we” are not.
Native and senseless point of view
“It could be a really positive thing to get people into an industry which now has a very high bar to enter, and enable them to get some experience,” Fradley said.
“There’s a huge opportunity in this. It’s not an us and them, or it doesn’t have to be an us and them.”
Try that logic in the Medical Profession – it is just nuts?
Example
Send your kids to the Qualified Dr – they can use a real Dr when they can afford one right?
Poor example. In the medical profession we have Chemists and Doctors who actually fulfil exactly these roles.
This is incorrect need a go for a script before a chemist noone goes to their chemist if unwell. Ludicrous
Last time I checked, pharmacists have qualifications and have to adhere to a code. The unqualified Qualified Advisers sales people will have neither
Pharmacists also have their Guild lobbying on their behalf. That’s why they get everything they want.
The medical profession is under threat by generative ai, and some qualified nurses and pharmacists can help do some tasks a doctor is authorised to fulfil, like prescribing prescription medications for pain and other ailments.
Today and the future, we need to provide the next generation many different pathways into a financial planning career as long as there are the right intentions and checks and balances that are not to overarching.
So you support unqualified sales reps working for super funds? The proposal will see them advising on retirement advice, which is not simple advice by any stretch. Do you also support these fake advisers having no cpd requirements, no code of ethics and no minimum training. This is what is proposed. I’m all for having pathways but this is a retrograde replacement of qualified advisers with substantial consumer protections, with sales people who skirt almost all of the protections put in place over the last two decades.
What if the chemist worked for a Drug manufacturer? It creates a conflict, so what do you think the Chemist will recommend? Would the recommend drugs unnecessarily? probably.
Also, if a chemist can prescribe, I dare say its limited to very benign conditions and likely to be AFTER already consulting a qualified Doctor. Eg. Blood pressure meds, continuing a regular prescription that a GP has prescribed prior.