The critical importance of making advisers’ voices heard during the consultation period for the Future of Financial Advice (FoFA) reform proposals is a message that is being driven home by the AFA as it winds up its 2010 National Roadshow this week.
… very few politicians actually understand financial advisers
Speaking to the record numbers of advisers attending the Roadshow presentations, former NSW Liberal Opposition Leader, Kerry Chikarovski, told her audiences that very few politicians actually understand financial advisers and the vital role they play in the community. This lack of understanding and appreciation is the key reason Ms Chikarovski strongly encouraged advisers to make contact with their federal member of parliament to make their voice heard.
Ms Chikarovski said that following Federal election on 21 August she expected the balance of power in the Senate would be held by the Greens Party, and this raised the importance for advisers and the financial services industry to also commence a dialogue with the Greens over key financial services industry issues.
Ms Chikarovski also told advisers that while it was less likely their local federal member would be available to meet with them during the election campaign, advisers should still make the effort, to ensure the adviser’s agenda is known and understood by the sitting member and other candidates.
Based on meetings held between the AFA and senior Treasury officials, Ms Chikarovski said she and the AFA Board believe the present consultation process on the FoFA reforms appears to be genuine, with Treasury officials indicating their willingness to better understand the financial services industry from the industry’s point of view and that of advisers.
As part of its strategy to communicate its message beyond the August election, Ms Chikarovski said the AFA would be conducting a survey of all candidates, asking how they would respond to key FoFA reform issues.
While the expectation is that only party-line responses to the survey would be received at this stage, the AFA’s strategy is that in conducting the survey in the first place, it positions the issues surrounding the FoFA reform proposals as an ongoing debate beyond the coming election, especially in the minds of those who will be forming the next government.
Irrespective of which party forms government, Ms Chikarovski expects key elements of the FoFA reforms will be implemented, such as minimum education standards, legislating the fiduciary interest of the adviser to act in the best interests of their client and offering ‘last resort’ investment reserve capabilities.
If the Liberal/National Coalition wins power, its key spokespeople have consistently maintained they believe it is not the role of a government to dictate how advisers should be remunerated, meaning a Coalition government will not legislate to ban commissions.
The AFA 2010 National Roadshow series will be completed in Brisbane tomorrow (29 July), where, in addition to Ms Chikarovski’s message, the audience will take back to their practice important insights shared by successful advisers and other key industry figures.
In other recent AFA news, the AFA has announced the names of the first graduating class of the Fellow of Chartered Financial Practitioner program.
One of the graduates, Dr Dennis Maddern (AFA Student of the Year 2009), likened the FChP pathway program to being a mini MBA for advisers.
In order to qualify for the FChP, advisers take a four-unit pathway program designed to help them deliver better outcomes to their clients. The units are:
- Ethics and compliance in practice
- Client engagement and advice
- Understanding, applying and implementing financial solutions
- Managing an advice business
AFA National President and Chair of the AFA’s Education Committee, Dr Jim Taggart, said the FChFP’s pathway program, which was built by advisers for advisers, focuses on delivering sustainable advice skills:
It is encouraging to see advisers recognising that education holds the key to their destiny…
“Advisers today need a broad range of skills, including education, experience, technical knowledge and people skills,” said Dr Taggart. “The FChFP pathway program delivers on each of these in every way. It is encouraging to see advisers recognising that education holds the key to their destiny and investing in the FChFP pathway program.”
