At AIA’s recent Adviser Summit, Coalition MP Bert van Manen said while the FASEA regime’s implementation was driving an exodus of advisers, he did not agree with the idea of creating specialist pathways for different occupations such as stockbrokers or accountants in order to retain industry talent.
“We’ve got a lot of people who have been in the industry a long time who even without the regulatory stuff were probably considering retiring. I accept that it’s brought that forward and that will create pressures as we go through the transition,” Mr van Manen said.
“As we get new advisers coming in with better education and training pathways, ensuring they are brought up through that process of a broad base of experience and look to specialise down the track if that’s what they want to do, that will stand the industry in good stead.
“But it will take some time as we manage that process of transition.”
The comments come as the Stockbrokers and Financial Advisers Association called for greater professional recognition of its members within the FASEA framework this week, as it revealed up to 65 per cent of stockbrokers at major firms had failed the November exam sitting.
“FASEA has a view that financial planning is the only form of financial advice and they’ve treated it as the core education, when in fact financial planning is itself a specialisation,” SAFAA chief executive Judith Fox told ifa.
“So stockbrokers, investment advisers, accountants, risk advisers have all struggled because their specialisations aren’t recognised by FASEA.”
However, Minister for Superannuation, Financial Services and the Digital Economy Jane Hume hit back at the association’s complaints, saying overall pass rates among stockbrokers since the exams began had been in line with the rest of the advice sector.
“There is plenty of opportunity to practise it. There’s plenty of opportunity to do training around it. And the best firms are doing that,” Ms Hume told Fairfax Media.
“I can’t understand firms that have put their head in the sand. It’s a denial of the reality of the industry they work in.”
Ms Hume added that as FASEA was still an independent body, she did not have the power to compel it to make changes to the exam.
Again Jane Hume, puts her head in the sand, Stockbroking is not Financial Planning, it is a specialist area with specialist skills and most Stockbroking Firms do not want adviser to be proving broader advice other than advice limited to Listed product.
If you’re a broker advising of client portfolios (super money) mate, you need to get the FASEA exam done, or go wholesale or just go. It’s just a regulations exam. Time’s a ticking and SAFAA won’t save you…
Why does stockbroking need to fall under personal advice?
Because “Broker” as a profession is generally what you make clients?
Seriously though, if you don’t know the answer, Jim’s Mowing franchises are available.
Does Bert really think $5000 advice fee for a middle class family will work for a personal protection program. Because without specializations, that’s what he will get. As the US General at Bastogne replied to a German surrender demand in 1944 – ” NUTS”
With all due respect Ms Hume u r the government and could stop this madness if u wantrd to.
Mr Van Mamen what new entrants? I wouldnt wish a life in financial planning on my worst enemy.
With a combination of the FASEA requirements (including up to 8 units) & the Haynes No2 bill, adviser numbers are plunging from 28 000 to only 14 000 advisers for a population of 26 million. That is ridiculous. I would like to see Bert Van Manen explain to his electorate why only rich people can access advice (as they have minimal red tape imposed on them) & low income families will find it almost impossible to access advice. This Govt is inept.
population of 26 million includes new borns to 25 year olds (unlikely to see a financial planner), I think circa 10,000 planners are enough for Australia, considering that less that 50% of the population over 25 would as the trends show, not see a financial planner.
Whilst I agree new entrants start with a general education and then specialise, it is the FASEA Exam that is at issue here which is likely to be almost 100% contested by existing advisers. If it is a base-line competency assessment, it should be more attuned to actual industry competency now.
A different, “all-rounder” exam, can apply to new entrants.
All that is needed is to change the case studies to include more broadly based client scenarios. The questions will be the same however, the adviser reading it will feel more comfortable in answering it.
In the meantime, my suggestion for candidates is to change references to non familiar advice areas to the one that you work in. Eg; insurance changed to investment etc. Re-read it and look for the “problems”/issues and you should be able to make a good fist of the answer. The exam does not want specific technical answers around advice areas, it is all the other cogs in the planning process that is being tested, and that is universal.
I have done the practice exams on the FASEA website and, in some cases, I do not agree with the answers they provide. There is a bit of a disconnect between reality and theory and if you have several years of industry experience your experience may guide you to a different answer. Specifically where clients have a Power of Attorney, whether the client has the ability to understand the concepts or has contractual ability. Those holding the POA definitely need to be regarded as speaking for the client in most cases. Obviously, experienced advisers will look for ‘elder abuse’ and bullying. Further, they will still need to act in the client’s best interest. In some cases, the example answers are too simplistic. The questions need to be composed with the purpose of eliciting the preferred answer for multiple choice. Short answer questions need to consider the possible alternatives which they do not seem to.
Doing the TAL FARSEA workshop last week and the first question on POA, TAL said FARSEAs answer was complete opposite to Corps Act. But it’s a FARSEA exam so must give their answer.
A perfect example of moronic conflicting unreal world FARSEA v multiple other regulators.
Our Government and Canberra clowns just don’t live in the real world.
A sad joke is FARSEAcal.