The Morrison government intends to follow Labor’s lead and give advisers with 10-years of experience and a clean record an exemption from the legislated relevant degree requirement, while also looking to streamline the approved degree paramaters for new entrants.
In a release from financial services minister Jane Hume’s office circulated today, the government also released for consultation draft terms of reference for the Quality of Advice Review scheduled for 2022.
Concerned at the reduction in adviser numbers during the course of the year, the government has signalled its willingness to abandon its hard line on degree qualifications.
“Consistent with the legislation, the minister will simplify the minimum education requirements while ensuring high quality financial advice for consumers, achieving the intention of the FASEA reforms without micro-managing advisers, universities, students and businesses,” the minister’s office stated.
“As part of this streamlining, the Government proposes to recognise the value of on-the-job experience through designating 10 years of experience, a good record and a tertiary level ethics subject as meeting the education requirements for existing financial advisers.”
Both leading parties are now set to conditionally repeal the equivalent degree requirement after the ALP announced its carve-out plan last week. With an election looming, in the pandemic era and with monetary guidance for consumers in high demand, policymakers have elected to swing the pendulum back from tough, bar-raising settings towards looser, more accomodative conditions.
Theoretically, if the youngest adviser in the industry to satisfy degree exemption conditions is now around 40 years old, it will likely be another 25 years or so before all licensed advisers are degree qualified.
For those who believe degree qualification is considered one of the benchmarks of a profession, that goal now sits a generation away.
The government’s consultation will also look at opening up pathways to the industry by broadening the suite of courses and degrees that qualify new entrants in advice.
A policy seeking submissions on the government’s proposed education standards has been released and will remain open from January 4 until the start of February next year.
Review terms set
Further to the announcement on education standards, the government revealed that the Quality of Advice Review will consider how the regulatory framework could better enable to provision of accessible and affordbale advice.
“In particular, the Quality of Advice Review aims to identify opportunities to streamline and simplify regulatory compliance obligations to reduce cost and remove duplication, recognising that costs of compliance by businesses are ultimately borne by consumers.”
Submissions on the draft terms of reference for the Quality of Advice Review will close on February 4, 2022.
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