When the education standards body faced the Senate economics committee last week, Liberal senator Amanda Stoker cited the examples of three advisers who are older members of the advice profession to FASEA chief executive Stephen Glenfield.
“Paul Franklin is 72 and he wants to continue to practice for another eight years. He’s been told he needs to do a full eight-unit diploma to continue. James Forde is 64. He would be required to do the full eight-subject graduate diploma. And Wayne Leggett is 64, has a bachelor’s degree and an eight-subject diploma of financial planning and would need to do five subjects,” Ms Stoker told Mr Glenfield.
Ms Stoker then pointed out all three advisers have over 30 years’ experience in the industry before asking Mr Glenfield how FASEA’s current professional requirements relate to the three advisers.
“Can I suggest that the approach that is being adopted by FASEA is not sufficiently recognising the service, experience and prior learning of people who are at the upper end of the profession?” Ms Stoker asked.
“I would only respond that the legislation requires, as part of the lifting of the standards that it was aiming to achieve, that advisers reach a bachelor or higher level of education,” Mr Glenfield responded.
Ms Stoker also criticised Mr Glenfield for FASEA’s lack of consultation around the final version of the standard, which she noted was different to the draft standard three provided in November 2018.
The draft standard three states: “You must not advise, refer or act in any other manner if you would deprive an appropriate personal reason for doing so.”
On the other hand, the final version states: “You must not advise, refer or act in any other manner where you have a conflict of interest or duty.”
“Did FASEA consult with ASIC on standard three and, if so, what did they say?” asked Ms Stoker.
“No. FASEA conducted a broad consultation on the code of ethics and received large numbers of consultation around standard three, many of which were requesting a better clarity of the words for what was intended by standard three, and FASEA settled on the wording as it appears in the standard now,” Mr Glenfield said.
“Can you see that the second version is completely impractical?” asked Ms Stoker.
“It’s not. We don’t believe it is,” Mr Glenfield replied.
I support lifting education standards but I also don’t think it’s equitable to force experienced planners to do study in an area when there was never ever the material there for them to study in the first place. My Margin Lending Course (because of Storm) was via the private Sector, my SMSF course via the private sector, my Aged Care course via the private sector, none of which is AQF level 8. I’ve consulted with Universities in offering courses, formulating Masters Degrees, and more recently FASEA consultation and offering courses in Financial Planning are simply not viable. Just look at the number of Uni’s that have ditched courses. But I’m really confused, when I read the FPA’s submission to FASEA calling for CPD to be worth 20 points out of 100 and a Bachelor of Financial Planning to be the norm….I fell off my chair. I am confused as to why FPA members still support their CEO and to top it off FPA members just voted back in two existing board members, who fully supported that submission. It makes no sense.
I suppose I am watching all this nonsense with a strange detached bemusement. I hesitate to say “bemusement” as I know how hard this is for many advisers. It would be hard for me too, if I was to elect to stay in the ‘industry’. I’m 58 and a while back I chose to be a risk specialist. I’m a fully qualified planner but enjoy and believe strongly in the place of risk management in a client’s portfolio. I had all good plans to continue for as long as my good health would let me – 70+, no problems. However I am dismayed, disappointed and, frankly disgusted at the life companies, politicians and vested interest special interest groups (we all know them) and the wayt they ALL sold advisers up the creek with LIF (commissions and responsibility periods). The FPA and AFA should be abjectly ashamed of themselves that it has all gone this far.
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I am not in the least concerned about study for these wholly unnecessary exams (for me as a riskie) as I will not be doing any of them. I refuse to do this idiocy. Why would I? TENS OF THOUSANDS OF DOLLARS of mine and untold hours away from family, business and clients into the coffers of self absorbed universities for these ‘courses’ and extraneous exams. For what? All of it will be of ZERO help to me or my clients in the management of their life, trauma and income protection advice. Is FASEA (or anybody) telling me I need more education about FP to help clients with simple risk products at great expense. It is like doctors being told they need to upskill to neurosurgery level – patently ridiculous. These paid-for govt clerks are going to destroy our once great industry, mark my words fellow advisers. FASEA et al would have me study and pay a billion bucks to learn about derivatives, international currency exchange rates, CDs and all manner of high level complex financial planning.
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I’ve never taken a fee from a client in all my 35 years in the industry. I have ALWAYS been completely transparent with clients in conversations about how I get paid and how commissions work. My clients are ALL happy to work with me under the commission basis. Way before SoAs and CARs I had the conversations with clients – nothing new for me. What is new is this ridiculous over the top compliance and exam system that will be the reason for me leaving my precious clients decades ahead of time. I’ll be OK -n sell my client base and retire very nicely than you. But it didn’t have to be this way and, again, I’m disgusted that the above mentioned entities have made it so.
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The life companies are in for a rude awakening – take it from someone who has watched and worked with them intimately for 35 years. There’s hardly a single executive today that doesn’t believe life cover will sell itself using Roboadvice. They want advisers gone to save on commissions – but we can easily see the outworking of that currently with their success in lowering coms and extending claw-back in LIF. These duplicitous life companies cannot be trusted on any level. Hold that thought as it will possibly save you some angst as you travel forward. See you on the other side . . .
This is all that O’dwyers fault and now shes cut and run and left everyone to deal with her mess the stupid useless cow
I think the bulldozer is in top gear with us in the sights. tried twice to talk to local MP re the issues and lack of clarity. NO answer or even acknowledgement. Think I will sit on the doorstep next week and see how it goes, otherwise it looks like we can all go to centrelink and become FIS officers.
or join the industry funds. you don’t need any qualifications there. I hear their toilet cleaners can give personal advice over the phone without any consequences
And often the ones who are teaching in the universities now have little-to-no real world experience in the field either, yet they feel qualified to teach those of us who’ve spent decades practicing?
Can 100% attest to this. Have a client who teaches as part of a FP degree at Uni. Was adamant her UniSuper TPD was own occupation and didn’t even know what a Statement of Advice looked like when I showed her hers
Given the politicians are technically elected and paid by us to represent our needs & wishes, why is it we can’t as a population instruct (or lobby) for them to require certain qualifications & education in order to retain their positions? Similarly for those working in ASIC and the-like, many of whom have only academic backgrounds with little-to-no real world experience in the matters they now oversee; some of who are life-long public servants only; and the ones who have some real experience are often in their current positions because they couldn’t survive in the profession in the real world. I believe often the people in power forget what and why they’re there, and that they should be reporting to us as the public, not the other way around all the time.
It is a pity that what could have been a great start to professionalising Financial Planning has been so badly managed by so few who perhaps do not fully appreciate nor understand the complexities of the problems within the advisory sector.
We are all well aware that change is inevitable. It is not only how the inevitable change needs to be managed, but WHO is to lead that change. We need a fresh set of people who will act transparently and with common sense. People who have a track record of being heavily engaged and respected within the advisory sector, as it seemingly has not been the case to date.
[quote=Anonymous]Amanda Stoker is part of the Liberal National government who passed this legislation into law. Is she now trying to do some grandstanding to try and win some support from the adviser community? I’m surprised that she isnt blaming Labor for this….seems to be standard LNP tactics…they obviously hope that people will forget that they’re moving into their 7th year as the government.[/quote]
…but the alternative would have been and will be far far worse! Labor and the unions are pushing thi sagenda as hard as possible. The end goal is the ever increasing rivers of gold flowing directly to them (to the tune of hundreds of millions of dollars in revenue and personal profits) from industry funds – that have totally escaped all but a token scrutiny by a corrupt ASIC.
[quote=Anonymous]The same Amanda Stoker that is a member of the IPA? There’s way too many members in the LNP who are part of this little club. Membership seems to imply that their loyalties go in the following order – No1 Self No2 IPA (which includes all the IPA sponsors & backers) No3 LNP then there’s a long stretch of daylight before the Australian people come in a long, very distant last…. Is that the Amanda Stoker you’re raving about?? [/quote][
Ah you mean as opposed to the OTHER little club that goes #1 Self #2 Labor #3 Union Leaders #4 Anyone else who will help line any of the above pockets, legally or illegally. In that little club house the public or even their own union members don’t even get a look in.
You’re a joke sunshine, go read Red Rag and stay where you belong.
Mate, have been a 25 year Liberal voter until the last election when I couldnt bring myself to vote for Smirko & the current Muppet show.
FFS what an arrogant twat he is!!
Why did FASEA take 4 staff to front Canberra? I would have expected the CEO could easily answer the questions thrown at him of the top of his head but clearly he is not on top of his position which shows a complete lack of profession standards – he didnt even know the standards. Then didnt know what ASIC’s submissions were as no notes were kept – how professional? And how is it good value to take four people – seems like they are over charging or wanted a fully paid trip to Canberra. Not good.
Not too long ago, Uni’s did not offer qualifications in Financial Planning (FP). FP qualifications were Adv Dip FP, with a CFP as the capstone. Uni’s did not want anything to do with this…but now they seem to think it needs to be a Bachelor Degree???
The FPA submitted that the standard should be a Bachelor of Financial Planning. A Commerce degree worth 20 points and CPD worth 10. I don’t think we should be blaming FASEA when they consulted with industry. I suggest those advisers go back to their respective association and read their submission and then make a call if they wish to remain members.
I think what is more alarming from actually watching the footage of the FASEA appearence at the Senate Economics hearing was the complete disdain Senator Peter Wish-Wilson demonstrated towards advisers. Interrupting two of the Senators on several occasions during their questioning with derogatory blanket statements about advisers and the advice sector. I have always maintained the view that he has done nothing for the constituents he is meant to represent and is nothing more than a leech on the tax-payers purse and this has only be further reinforced by his broad, sarcastic remarks during this hearing.
O.K., FASEA has been grilled. And then? Life goes on as per the current FASEA’s requirement?
That’s what it says in the legislation this government introduced….
Well said, Senator Stoker! Good to have someone in a position of influence (who also has a strong media presence) calling out the massive impact this poorly orchestrated transition will have. We can only pray that the allowance for RPL starts to take into account decades of performing to the standard required and previous compliance with CPD. All existing Advisers should be actively supported by the government to transition their businesses into the new regime, including selling or grafting in recently qualified (but generally young) professional advisers and providing mentoring to them as they gradually take over. The current trajectory has seen a 7% drop in advisers this calendar year – and this will continue at pace as we head towards the deadline imposed on the industry.
There are currently 27,000 registered advisers serving 25,000,000+ people (ratio quickly heading to 1:1000). The industry’s relevance is already diminishing. So I would respectfully suggest to those who applaud the reduction in adviser numbers – be careful what you wish for; fewer advisers means less backing from industry supporters, therefore, less support for business. More broadly, industry associations and all of us as a collective will become less and less relevant as adviser numbers decline. This is leading to a very bad outcome for industry and consumers.
All politicians are running this country which is a BIG business. Maybe it should be legislated that all politicians have a degree in a business discipline. If they do not, they cannot run for parliament at the next election.
But, to be fair, just like the FP community, they will have about 3 years to do the degree on top of their full time work and family commitments. It is expected of us so will not be any problems for them…….and NO exemptions for experience. I have over 35 years experience and get no exemptions so why should they !!
Come on Australia, lets get our politicians qualified !!
[i]”Standard 3 is perfect if you are Government Employee on a regular wage or maybe a bank employee or salaried Industry Fund Adviser”. [/i][i][/i]
Pretty good summary in that statement.
Makes you wonder exactly whose consultative document FASEA took notice of.
Instos & Industry Funds, what an alliance?
Looks like Amanda Stoker is he only politician in Canberra they don’t have their hooks into.
I am 73, commenced in financial services in 1972 and became an “official” financial planner in 1988. I have had the CFP qualification from the 1990s and have had no difficulty in maintaining it through ongoing Professional Development. At this stage I intend to continue as a Practice Principal but do not intend to sit the FASEA examinations or commence any tertiary study which means I will not be able to give advice. My clients, many going back to the 70s and 80s think it is a joke. I think it is sad. I really believed a had a few good years left in me.
I’m licenced advisor – I have a Master Degree (Macquarie), a GAICD, I have a Diploma in Stockbroking (Deakin Uni), Diploma in Financial Planning, RG146 in Mortgage Broking, SMSF, Derivatives etc. etc. Plus 20 years experience. Advised via FASEA registerd university (note: not all Universities are FASEA registered) none of the above qualifies for RPL. Agreed they are destroying the profession, to the detriment of accessible, affordable, financial advice.
Stoker is right. Standard 3 is a basket case. Watch ASIC force super funds, insurance companies and licensees to switch off all commissions and asset-based fees on 1st January. Our businesses will be destroyed, tens of thousands of jobs will be lost and the 2 million Australians who trust and value our advice will be left in the lurch.
I note there ridiculous comment which I think they make them up as they go along the three advisors should not have to go through this situation they have been in the business long enough not to have a degree they have the knowledge in what country would you are basically terminate a person from his profession and he may have to go on social benefits I think fasea should be closed and we look for anothe model this lot don’t care about people who have lived and breathed Insurance they are the ones who need help not being kicked out of a job they only know
My head hurts after reading that Patrick. Punctuation – such a good idea! Gives your point much more impact and meaning too!
FASEA has a one size fits all model – it’s lazy and wasteful. I have been giving advice for over 30 years, have a Bachelor and Masters Degree, hold my own AFSL (which required ethics qualifications), and I am former NSW President of CPA Australia. Now I am expected to fork out thousands of dollars in fees and time simply so FASEA can tick a box – it’s ridiculous and unintelligent. Did FASEA consult with any senior advisors or seek input? We are the experts on what is needed if anything – not corporate boffins. This is just a knee jerk reaction to large financial institutions who tried to commoditise financial relationships and failed – meanwhile while they leave the industry we bear the pain of their legacy.
Amanda Stoker is part of the Liberal National government who passed this legislation into law. Is she now trying to do some grandstanding to try and win some support from the adviser community? I’m surprised that she isnt blaming Labor for this….seems to be standard LNP tactics…they obviously hope that people will forget that they’re moving into their 7th year as the government.
Exactly, bloody over Complicated ODwyer and LNP gestapo against small business and Financial Advisers gave unfettered, highly conflicted control to FARSEA.
Fasea YOU AND THE FPA are a joke. A panel of goons. I will not put up with your pathetic holier than though nonsense and will not be taking any further studies to appease you and your ridiculous unnecessary bar setting.
I think you will be reigned in and taught a lesson. The FPA is already losing members in droves it’s just a matter of time before someone stops FASEA thinking they are doing good.
Go away. You ridiculous panel of fools, stop self pleasing eachother and fix this mess with common sense you morons.
Does Mr Glenfield still have a job? Surely after not being able to name the 5 core values when asked in this Senate Estimates hearing, the board of FASEA would have fired him on the spot?
The study is also meaningless for advisers with a reasonable level of experience. I did a masters of fin planning at Kaplan. Total waste of time as I learnt close to nothing. Was able to do the exams and assignments without studying the course material. Cost of 30k.
And what was the opportunity time cost ?
[b]At $300/ hr and FARSEA guide of 120 hrs per course = $36,000 per FARSEA course. [/b][b][/b] plus the actual cost of the course.
I don’t think that this was the most effective line of questioning re: experience vs education, as welcome as it is to see FASEA have to provide some answers.
On one hand it is a very tough ask on these more “experienced” advisers to have to undertake significant study. On the other hand, certain “experienced” advisers are part of the cause of this whole situation. The ones we might refer to as “old lifeys” are the ones we want to leave the industry. To credit these advisers with experience in lieu of improved education and let them keep going isn’t achieving what I’m sure we all want.
Yet we also want the reputable experienced advisers to remain. It’s a fine balance and I’m not sure of the best solution.
Standard 3 is perfect if you are Government Employee on a regular wage or maybe a bank employee or salaried Industry Fund Adviser. Sadly i am self employed and owe money on a life insurance register which by the sounds of it i can’t receive commission on from January 1. I need to convert all these clients to fee for service before then which is impractical if not impossible. So from January 1 a major part of my income evaporates whilst my bills and loan repayments don’t. I don’t believe i am alone in this situation. But as long as Mr Glenfield thinks it workable, that’s ok. This will decimate many practices when the law says it is still legal to receive insurance commissions. WE may as well scrap the next ASIC review into insurance commissions because FASEA have made the decision already. Happy New Year…not. Please tell me i am wrong and i have misunderstood Standard 3.
Nice to see them having to start answering questions on their actions
These are the questions that should have been asked two years ago. And should be asked again when FASEA opens up its consultation process on November 12, when it will ask for submissions from designated representatives of consumer, professional education and other industry groups. So who are these designated representatives going to be? Who selects them? What are their agendas? And, who are the other industry Groups? The FSC maybe? Anyway, we at the UFAA will await our invitation. Well, we have sent a request to Mr Glenfield to join the party. Maybe we’ll go along as a plus one?
this is going to far, what are they trying to achieve. I believe FASEA has lost is way & purpose. its is placing ridiculous standards. Let clients & advisors reach there own terms of engagement Not FASEA & with education standards yes need to to increase but nothing beats experience. You are killing the profession, making advice unaffordable. People we suffer in the long term with no advice or once size fits all such as industry funds & Robbo advice. Not good for the future.
I don’t thing FASEA actuality understands what the role of an advisor is or does.
I think FASEA does but they werent the one’s who wrote the legislation, were they? That would be people like Amanda Stoker who is part of the government, you now the one’s who wrote the legislation that contains the requirements all advisers must abide by and the timelines that all this must run to. Stoker is part of the government who also selected the Board to implement what they the government had decided to inflict on advisers.
The old adage about shooting the messenger has never been more apt.
This is just another example of incompetent, lying politicians who have NO CLUE about the industry’s they legislate for. I need a Degree and extensive training to practice as a Financial Planner, yet the people who make these laws have no idea, have probably never dealt with a planner themselves and in many cases have been molly-coddled thru a series of high paying roles before landing a cushy job as an MP or Senator where someone else covers all their costs.
Avoidance of all conflicts of interest is impoossible.
A Code of Ethics built on flawed principles will cause the cure to be worse than the problem.
Amanda Stoker is first rate and there should be more like her in our polictical system.
The same Amanda Stoker that is a member of the IPA? There’s way too many members in the LNP who are part of this little club. Membership seems to imply that their loyalties go in the following order – No1 Self No2 IPA (which includes all the IPA sponsors & backers) No3 LNP then there’s a long stretch of daylight before the Australian people come in a long, very distant last…. Is that the Amanda Stoker you’re raving about??
The whole FASEA thing is a joke. Everyone knows that uni degrees aren’t worth the paper they are written on anymore. Don’t set you up for the real world. Ever since the government change the way universities were funded around 1999 – 2000, the standard of universities and many other courses have drop dramatically. Adviser education needs to improve dramatically, but FASEA misses the mark completely.