In announcing an impending industry consultation on financial adviser professional standards, the Federal Government has moved a step closer to the possibility of shaping future qualifications and testing requirements to take into account their relevance to the nature of the advice proposition.
Fulfilling a pre-election commitment made by now Financial Services Minister, Stephen Jones, the minister announced he has asked the Federal Treasury to develop a consultation paper on options to streamline the education requirements for financial advisers, including for new entrants.
This announcement seeks to fulfil the Government’s election commitment to remove the tertiary education requirements for financial advisers of good standing who had passed the Adviser exam and had 10 years’ experience.
Public statements made by the minister earlier this year, however, suggest this new consultation process may include a conversation with the sector about the merits of developing specialised learning and specialist streams that would reside within a future adviser qualifications framework.
…it was always anticipated that there would need to be specialist learning and specialists streams within the qualifications recognition
Lending support to this possibility were comments made by the then shadow minister at AIA Australia’s 2022 Adviser Summit in March, during which Minister Jones stated “…it was always anticipated that there would need to be specialist learning and specialists streams within the qualifications recognition.”
…they tried to squeeze everyone through the same funnel
Explaining the rationale around his thinking at the time, Jones noted the problem with the qualifications developed under the FASEA model was that “…they tried to squeeze everyone through the same funnel and testing people or educating people in a range of things that are just not relevant to the job they have been doing for the last 10 or 20 years.”
Jones also noted the significant representations he said had received from brokers and also from those in the risk sector: “…and I think some pretty good points have got to be made.” (see: Labor Will Sort Out Adviser Qualifications ‘Mess’…).
More recently – at an FSC political series event in late April – Jones doubled-down on his point about the potential to develop testing and qualifications based on different advice streams. Within the context of making a point around greater recognition of prior learning, Jones stated Labor also understands that there are many streams within the financial advice profession and that a Labor Government would “…ensure that this is recognised within the qualifications framework.”
The Minister notes he expects consultation with the sector to commence shortly, and Riskinfo will report further developments as they unfold.
Stephen Jones was totally open to listening to the issues and recognised that the Education requirements were driving Advisers away, while also making it unattractive for potential new people to want to go down the path of being an Adviser.
Our Business has done extensive work presenting and making submissions to key stake holders, including Government, Regulators, Treasury, Associations, Life Insurers, Licensees, Advice Practices and Advisers, promoting risk Advice as the foundation of Financial Planning and that initial and ongoing education requirements for risk advice must be separated from Investment advice so Advisers and Practices can rebuild their risk service offerings without the crushing restrictions that have forced thousands of Advisers to exit and many of the remaining Advisers to scope out risk advice due to the cost and time constraints that has made risk advice unprofitable.
We have noticed that key people are now listening to what we have been saying for years, which is encouraging.
There is light at the end of the tunnel.
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