Existing financial advisers will be required to a hold a degree equivalent qualification by 1 January, 2024 if they wish to continue to practice, according to new proposals released by the Financial Adviser Standards and Ethics Authority (FASEA).
Advisers, however, may be able to short track the study they may need to do as FASEA also announced that advisers who had undertaken eight units at a post-graduate level by 1 January, 2024 would also meet the required standard to practice.
In the proposals which have been released for consultation, advisers would be able to continue practicing from the start of 2024 if they:
- hold a qualification that is on the FASEA approved register;
- have completed an Australian Quality Framework level 7 (AQF), or bachelor degree level, qualification that is on the FASEA approved register;
- have completed a course that offers at least 8 units at AQF level 8, or post-graduate level, covering fields that include ethics, professional attitudes and behaviours, financial planning and advice processes, and technical requirements.
The consultation paper released by FASEA stated that an 8 unit AQF8 program typically led to a Post Graduate Diploma qualification, which takes two years to complete part time, but admission into an AQF8 program required at least five years experience. In comparison, an AQF7 level qualification which would take three years full time and six years part time.
Advisers who currently hold a financial planning or financial advice qualification will need to ensure that it is recognised by FASEA…
Advisers who currently hold a financial planning or financial advice qualification will need to ensure that it is recognised by FASEA, and if not will be required to undertake a course of study as will those who gained qualifications more than 10 years ago.
In some cases, advisers will be allowed to take bridging courses but the details around these have not been released and FASEA expects the first of these courses to be available from early 2019.
The Minister for Revenue and Financial Services, Kelly O’Dwyer MP, welcomed the guidance stating, “This announcement will provide early certainty around what will be required for financial advisers to meet the new requirements.”
O’Dywer said previous education requirements were found by the Financial System Inquiry and the Parliamentary Joint Committee on Corporations and Financial Services to be insufficient and allowed some advice to be given after only a few days of training.
“This announcement by FASEA continues the implementation of the Government’s reforms that will build trust and confidence in the financial advice industry and ensure that consumers have access to professional advisers who will put their interests first,” O’Dwyer said.
The consultation paper will be open to stakeholder feedback on the practical application of the proposed education guidelines from early 2018.