The federal government could look at incentives to support people entering financial advice in a bid to curb declining numbers, an industry figure has suggested.
As the jobs and skills summit continues in Canberra — where low financial adviser numbers are expected to be addressed — Midwinter’s head of advice sales, Stacey Cowan, put forward the suggestion to ifa after noting that the increase in professional standards has led to a decrease in adviser numbers in Australia.
“The government could look at incentives to support people entering the profession. For example, the Victorian government just announced a plan to pay for the degrees of more than 10,000 nursing and midwifery students,” Ms Cowan said.
“Could a similar program incentivise people to enter the financial advice profession?”
It comes after an opinion piece written by Ms Cowan and published on ifa earlier this year, advocated that advisers look at “the great resignation” as a “great reset” and consider how it can help their practice.
The financial advice software provider head also discussed advice businesses using technology in regards to the government’s intention to address women having equal opportunities and said that providing flexible working arrangements promotes better opportunity for people to remain in the workforce and balance other responsibilities.
“To enable this flexibility, advice businesses need technology that supports a hybrid work environment,” Ms Cowan said.
“The world of advice tech can be confusing; we hear from many advice professionals that they just don’t have time to review and implement new technology. At the summit, we can anticipate a discussion around how digitalisation can boost productivity, as technology continues to play a crucial role in supporting advice practices’ employees, operations, and clients.”
Speaking to ifa earlier this week, FINSIA CEO and managing director, Yasser El-Ansary, said the summit will “undoubtedly” be an important catalyst for a wide-ranging policy discussion about “how we position our economy for the future”.
“For too long now, we have generally failed to adequately prepare for the long-term structural changes that are already impacting our economy,” Mr El-Ansary said.
“We know that the skills which will propel the growth of our economy into the future will be significantly different from the skills we have relied on in the past — I hope and expect the summit will create a strong platform for the whole community to engage in this discussion over coming months. Everyone in the community has a stake in creating a strong economy that is supported by skills and capability building for the long term.”
Should we add this to the long line of failures in relation to government interference into an industry? Why don’t we ask the Risk Insurance industry how they feel about government interference.
Always and everywhere, government should be [i]seen and not heard[/i] (and not often [i]seen[/i]). Governments best move, always, is to move OUT of the way and let responsible private enterprise and citizens get on with the job. Most people in government are more qualified at self enrichment and self-aggrandizement than they’ll ever be qualified in their respective ‘portfolios’. Generally, anyone who [b]wants [/b]to be in government [i]should not[/i] be in government. The running of our country is far, far too important to entrust to anyone who aspires to be a politician.
I am over this knee jerk reaction by Government to incentivise everything and make it free. In the last week I have heard:
* Free university for 10,000 nurses
* Free childcare for everyone
* Free TAFE for another 180,000 people
These things aren’t free. It is just another way to move money from one part of the economy to another. From one group of tax payers to another group.
How about instead of having to provide free childcare, stop putting rubbish requirements on childcare centres that increases the costs.
Same with financial planners, it is astounding that the Government imposes bucket loads of rubbish red tape and then wonders why fees are so high and people are leaving. Address the cause of the problems, not the symptoms.
Such an “incentive” exists already. The charging of over $60 million in ongoing “intra-fund advice” fees from millions of super fund accounts, without the consent of those default fund members. How much more do they want to rob fund members?
Scrapping many of the current draconian red tape FP regulations will attract far more new entrants than offering incentives which would be as useful as putting an air conditioner on the outside of a moving car…
What a complete waste of taxpayers money. Fund ASIC to destory the industry, fund FASEA to scare people into early retirement, lose a huge amount of skill in the industry, then fund new entrants.
It’s the self-licking icecream, isn’t it?
Mouse, you missed out the bit about the need to create a new ASIC and Treasury taskforce to oversee the buildup of adviser numbers. I am sure this would need at least 15 more staff…
Government should never incentivize anyone or anything.
There is no point offering a carrot to anybody to enter this industry. In my 40 + years career, I was given many incentives to grow my practice and they were all taken away by various Governments of the day. It took years to establish a profitable business from scratch. Free education is not going to solve the malaise. Experienced advisers have left because their incentives have gradually stripped away federal Interferences beginning with the Gillard Labor Government.
Increasing professional standards is extremely important it will not guarantee financial success. It takes heart and perseverance to remain in the industry and unfortunately there are those who have lost heart, perseverance and confidence.
(1) Comparing financial planners and nurses with the general public will not end well (2) if the government fixed what they had stuffed up you would not need to offer incentives.
I would not recommend anyone become a financial planner at the moment even if they received an “incentive” of $100k, the job is terrible and not worth the time or effort needed to get a degree.
How about paying every remaining adviser for the pain and suffering they have had to endure!
Surely GOVT wouldn’t have to look at schemes to incentivise people into Financial Advice had the GOVT not just victimised, bullied and harassed 42% of Advisers to leave the Advice Industry in last 3 years.
Great own goal Govt, ASIC, AFCA, FARSEA, Frydenberg, Hume & LNP.
and pigs might fly
They need to change the regulations around the God-forsaken professional year. Having to log 1500 hours, down to the level of date, which client, what time start to finish and what FASEA areas for each task is an absolute waste of time for anyone that has experience. And takes far longer than a year in real terms. That’s your reason for the lack of new authorised advisers coming onto the scene. Licensees should have discretion as they used to, as long as education standards are met and the exam passed.
Let’s not get carried away…next someone will be suggesting they build a statue for us or have a financial planner awareness round in the AFL next season
Is this the twilight zone ? It’s the insane regulatory and compliance environment ? What is there to not understand ?
Could not agree more, sick and tired of these non-main stream individuals who are not advisors, don’t have to sit exams, not having to navigate a minefield of traps and pitfalls daily or you will be breached, reported, named and thrown out of the industry, yet these know nothings think they have the answers! they are the real problem this industry has got to the lows it is today.
Subsidies are NEVER the answer… They might present well to the recipient and for the Government’s marketing, but any industry should be embraced on its standalone merits. Absolutely agree that the abysmal regulatory regime that is currently in place is a major deterrent for new and existing advisers.
The best incentive the government could provide is fixing the bad regulation that makes giving professional financial advice unnecessarily difficult and stressful.
Unless that happens, any sort of subsidy to study financial planning will be completely wasted because new graduates will change career as soon as they realise how bad it is.