The number of advisers on ASIC’s financial adviser register has dropped by over 603 since 23 December, with the true losses as a result of the FASEA exam deadline expected to be felt later in the month.
The number of advisers on the FAR was now 17,670, a drop-off of 2,968 compared to the 20,638 that were registered at the start of 2021.
Since 1 December 2021, the industry lost 847 advisers.
Colin Williams, Wealth Data director, said licensees had up to 30 days to report adviser details so more would be reported by the end of the month.
“My understanding of it is the reporting hasn’t gone through in a way possibly some may have expected in the sense that if you hadn’t passed your exam, then you’re kind of automatically taken off [the FAR],” Williams said.
“ASIC are waiting for people to tell them which advisers have passed the exam, and which have failed twice are waiting to hang in to September.
“They’re going to get that information and I suspect in the next data load we get it will become a lot clearer.”
The end of the last financial year saw a drop-off of 549 – one of the largest declines in adviser numbers.
“We were predicting anything between 15,000 and 16,000 because of FASEA,” Williams said.
“However, those late changes that occurred as a result of a big fall in June and I think that worried a lot of people, so they started introducing changes.
“The main changes were that if you failed twice you could continue on until September. I think that gives some advisers – even those who had no intention of passing the exam – it gave them extra time for the sake of a few hundred bucks.”
The minister for superannuation, financial services and the digital economy, Jane Hume, announced the extension last year telling Professional Planner at the time it would give advisers a “clearer run” due to Covid-19 disruptions.
Hume denied the Government made the change over concerns of adviser numbers, but Williams said it was because of Government invention the industry had dropped as low as 16,000 advisers.
Williams added the other issue was a lack of new advisers not supplementing the losses.
“We were definitely heading towards 16,000 no doubt about that,” Williams said.
“The replacement is woeful. the number of provisional advisers coming on board is just not there and unless you get new provisional advisers coming on, even without FASEA and all the other issues, you’re still going to run into trouble.”