‘Sensible Changes’ Sought on Adviser Education – Submission

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Rice Warner has reiterated the findings of its October 2020 report for the FSC on the Future of Advice in its submission to ASIC on promoting access to affordable advice; including a call for the law to recognise specialisation by advisers.

(See: Launch of Radical Plan to Revamp Financial Advice.)

The company’s submission to ASIC notes that in summary it believes that:

  • The overall legislative and regulatory regime must be structured around the different levels of complexity and risk of products and the advice that is given regarding them
  • The compliance regime for a specific set of advice must be appropriate to the complexity, risk and specific requirements of that advice
  • The educational and practice standards for a specific set of advice must be appropriate to the complexity, risk and specific requirements of that advice

It’s submission includes a section on education noting that as with all other aspects of the financial advice regime, there is no differentiation between the type of advice and its complexity.

“Worse, the requirement of a three-year degree in financial planning effectively shuts out of the market many potential practitioners, who may be more qualified! Examples are actuaries and accountants.”

…A stockbroker need not be an expert on life insurance; a life insurance specialist does not need to understand investment markets…

While Rice Warner says it agrees that those financial advisers providing complex advice on a regular basis need to be properly educated, it would seek “sensible changes”:

▪ The law should recognise specialisation. A stockbroker need not be an expert on life insurance; a life insurance specialist does not need to understand investment markets

▪ Those who are qualified in other relevant fields should be able to provide advice within minimal additional qualifications. For example, a superannuation actuary should be able to give advice to consumers approaching retirement without needing a tertiary degree in financial planning

▪ Many aspects of scalable advice carry little risk for consumers, and the education and training of those delivering this advice need not be as thorough nor as complex as for those providing comprehensive advice

The submission says the company considers there to be many professions where education and qualifications are specific to the level of service being provided.

It says a good example is the medical profession with generalist and specialist doctors, nurses, nurse practitioners, midwives, and paramedics. “Many doctors objected when paramedics were established as a profession with authority to deliver complex therapies and dangerous drugs, but nobody objects today.”

Rice Warner says people who are well trained in specific, limited disciplines can deliver a service that is at least as professional as that delivered by those with more comprehensive training. “A similar approach is needed for financial advice.”

Also see: Call for a Combined Working Group to Address the Cost of Advice and New ASIC Advice Unit Proposed.



1 COMMENT

  1. WOW, some common sense. This is a refreshing change.

    Rice Warner should be congratulated, as they are the first to put the blindingly obvious into plain English.

    Plain English is an anathema to the elitist Education and Legal Eagles, as it interferes with their New World order of total complexity to maintain their control.

    The fact that they have been instrumental for the total chaos that has cost Billions of dollars to the Government, tens of thousands of jobs lost, many suicides, thousands of great advisers who have exited and thousands more to exit the Industry, the retail Life Insurance Industry in a terminal decline and millions of Australians who will no longer be able to have an adviser to guide them, means little to that insidious group.

    There has always been bad people and the world will continue to have to listen to their lies and deception, what needs to start happening, is for leaders to call out and make these people accountable for their actions.

    The good news is our voices are starting to be heard. What we need now, is for the right action to be taken.

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