‘FASEA got it wrong’: Government urged to change education standards proposal

In its submission to Treasury this week on the Education Standards for Financial Advisers policy paper, the Financial Planning Association of Australia (FPA) has argued that streamlining education requirements “risks the professionalism journey” that advisers have undertaken over the past decade.

The government’s paper, released in December, proposed a pathway coined the “experience pathway” that streamlines the minimum education requirements and recognises on-the-job experience for individuals with 10 or more years of full-time experience.

“It’s so important to maintain the gains our profession has won and keep the trust of consumers. We cannot return to the days when a planner could technically be qualified with only a two day course, with no timeframe for that to change,” FPA chief executive Sarah Abood said.

“For this reason, the FPA does not support the proposed 10 years of experience in the past 12 years pathway as proposed.

“We believe this is an insufficient foundation to meet the objectives of raising the minimum education requirements for the financial planning profession, while also continuing to build consumer confidence in the profession.”

Instead, the FPA recommended the experience pathway only be available to professionals 55 and over and who have “at least 15 years’ experience gained in the past 20 years, and be sunset in 10 years’ time”.

The association said this will alleviate pressure on experienced advisers but maintain the goal of the proposed framework.

Further, a survey undertaken by FPA members found that 83 per cent have already met or are on track to meet existing education standards and the majority of members opposed the proposal.

Ms Abood said the current legislated framework was not executed efficiently by FASEA.

“For the most part, our membership supports an education framework which includes more recognition of prior learning and experience, which we believe FASEA failed to take into consideration sufficiently as part of their legislated framework,” she said.

“FASEA got it wrong with its one size fits all framework. Financial planners have entered with a variety of degrees and prior career experience, and they shouldn’t have to restudy what they already know.”

In a separate submission this week, the Association of Financial Advisers (AFA) argued that the “uncertainty” surrounding the proposal could see more advisers exit the industry.

Neil Griffiths

Neil is the Deputy Editor of the wealth titles, including ifa and InvestorDaily.

Neil is also the host of the ifa show podcast.