A former NSW premier and three female financial advisers have written to a federal MP warning that the FASEA reforms will disproportionately impact women.
Late last month, financial advisers Pamela Anderson, Halle Yilmaz and Philippa Hunt wrote to deputy opposition leader and shadow minister for women Tanya Plibersek expressing their frustration with the looming FASEA education requirements.
“In our view, FASEA is the most threatening and unreasonable piece of legislation the industry has ever experienced. It is deeply unpopular with over 95 per cent of the industry's 24,000 advisers and, according to CoreData research, more disruptive than the royal commission, mainly because FASEA’s processes are opaque,” the letter stated.
The advisers included a submission that was also sent to FASEA in June, titled 'Unintended Effects of FASEA on the Financial Planning Industry and Women'.
“Women will be disproportionately affected. Twenty-five thousand staff employed by 10,000 advisers will likely be made redundant,” it said.
“Women clients will not be able to access the increasing cost of financial advice as they earn less and have less super, which is not affordable to provide advice with increasing level of costs with compliance and increasing adviser educations costs.
“There are approximately 24,000 advisers in the industry, many solo operators or have two-three in the business on average. Only 20 per cent are women and this has not changed in the past 20 years. Each adviser has on average 200-250 clients that they manage. Most businesses and employ 2.5 support staff, mostly women.”
The three advisers informed Ms Plibersek that under the FASEA regime “existing degrees including relevant ones are ignored”.
“We all know there are certain knowledge and skill set that can be transferred from one industry to another easily and effectively. Besides that, FASEA has an overlapping education requirement. All the advisers are required to take a national wide exam on certain subjects. Afterward those who have passed the exams required to take courses on the exam subjects again,” the letter stated.
“We feel we are being unfairly bullied by some politicians and their allies wanting financial advisers out of the industry and certain universities salivating over many thousands of advisers paying fees for unnecessary education.
“Advisers who are five years out from retirement will be forced to retire early. We feel there is a discrimination against women, old and relevant degree holding advisers.”
The three advisers aren’t alone in lobbying the ALP over FASEA.
Industry association the AIOFP has aligned with the left-wing Financial Sector Union (FSU), which has formed a new ‘financial advisers’ category. The AIOFP will manage a committee that formulates industry policy for the national executive of the FSU. This committee will then forward their recommendations onto the ALP policy committee.
“To commence this process, we met recently with opposition leader Tanya Plibersek about the gender discrimination aspects of FASEA, which were well received,” AIOFP executive director Peter Johnston said.
Former NSW premier Nathan Rees is the national assistant secretary of the FSU. He has written to Parliament and alerted MPs to what he calls “a range of unintended consequences on financial advisers and the broader Australian community” of the FASEA proposals.
“We are concerned that the proposal directly discriminates against the 20 per cent of current financial advisers, who are women,” Mr Rees said.
“The business of providing independent financial planning is attractive to women who want to balance their work and family commitments, particularly those who want to run their own business. At the moment, we estimate that around 20 per cent of advisers are women, many of whom are sole parents. The proposed requirements have a disproportionately negative impact on these women and their families.”
Mr Rees said the FSU is concerned that for planners who work part-time, predominately women, and work flexible hours, they will not be able to complete the required study part-time within the time frame that FASEA is proposing.
“FASEA has not considered the gendered nature of the proposed changes and should they go ahead there may be grounds to file a case in the anti-discrimination commission,” he said.
“In an industry that already has the highest gender pay gap (31.9 per cent in 2017 according to the Workplace Gender Equality Agency), we need policy solutions that support the ongoing participation of women, not proposals that will see opportunities for women dry up due [to] barriers introduced by regulators.”
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