The Joint Association Working Group says maintaining a high standard is central to its new education pathway proposal, which aims to boost flexibility in the current structure to attract new entrants to the profession.
JAWG announced its proposal last month, which focused on using the five core knowledge areas proposed by the government (commercial law, behavioural finance, taxation, advice regulation and ethics), along with three other subjects that would make up the eight units required for a bachelor’s degree.
Importantly, the proposal would allow subjects already studied in similar fields to be counted.
SMSF Association CEO Peter Burgess said his association supported the proposal because it wants more flexibility, but still wants to maintain a high standard.
“It’s not about reducing the bar…that was a non-negotiable as far as I was concerned,” Burgess said at the Stockbrokers and Investment Advisers Association in a panel session with SIAA CEO Judith Fox and Financial Advice Association CEO Sarah Abood.
“As an association we stand for raising competency standards, so it was an absolute non-negotiable that whatever we did here was not about lowering the bar at all into the profession.”
Noting the standard has largely been geared towards holistic financial planners joining the industry, Abood said the FAAA supported expanding the pathway to address the advice gap.
“We know we need far more people with these qualifications and the current system is not supporting that, but it was really important to us and our members that the standard didn’t fall,” Abood said.
Abood said it was important to broaden the pool of advisers while not lowering the standard and that the minimum qualification requirements remained at a bachelor’s degree level.
“The current qualification framework works really well for a number of participants; certainly, a number of our members are happy with it,” she said.
Changing teams
A core theme to the proposal is making advice more attractive to career changers and Burgess said this is because they have often already completed degrees in other disciplines.
“Rather than having to complete a second degree…and re-study those knowledge areas they have perhaps already done, this proposal will enable them to get credit for those particular units,” Burgess said.
FASEA previously approved pre-existing and current degrees, and with the authority now defunct, Burgess said the educators would have to move to a self-assessment model.
“The education provider would self-assess against the curriculum,” Burgess said.
“Once they’ve done that the results of that would then be recorded and shown to ASIC and ASIC would maintain, in our view, some form of register which would list all the various subjects that have been approved as being counting towards a financial planning qualification.
“We would expect those providers to be audited every now and again to make sure their self-assessment process is correct and they have met the criteria.”
Abood said she doesn’t expect a change to the role in the process played by licensees.
“Licensees already have the obligation to ensure the qualifications of their advisers are appropriate to the areas of advice they’re practicing in,” Abood said.
“It’s already the case that most licensees don’t authorise someone who’s been practicing in life insurance, in direct shares, unless they’ve got specific qualifications in that area, and I anticipate that would continue.”
Working together
Noting the conversations JAWG had with Treasury over the proposal, Fox said JAWG acknowledges there is no indication what it has put forward will be accepted, but that Treasury and Minister for Financial Services Stephen Jones were “keen” to hear the unified proposal.
“We’ve been asked some questions by Treasury the Joint Associations Working Group is responding to,” Fox said.
Asked whether the JAWG members would ever consider merging, like the Association of Financial Advisers and Financial Planning Association did last year, Fox shot the concept down.
“What we recognised when we came together in the Joint Associations Working Group was that we have all these common interests, we’re all representing advisers, but we are all different streams of advice,” Fox said.
“One of the challenges would be, if we were to merge, is that some of those streams of advice could disappear, some others might come to the fore. The idea that you can be a voice and provide training, guidance, professional development that’s geared and tailored to your stream of advice is very important.”
If we can please put aside idealism and jump back into the real world, anyone who cares to spend even a cursory amount of time and effort, can see that the utopian vision of a highly educated group of Advisers, has come at the expense of the stated goals of more Advisers.
There seems to be a distinct lack of clarity around the financial impacts to Australians who have nil or insufficient wealth protection to build a platform for their wealth planning and it is totally hypocritical where certain parties espouse the importance of higher education as the benchmark of professionalism, yet fail to recognize that the very same protocols they are pushing, IS the reason for the collapse of the specialist risk Insurance Adviser pool, where thousands have left the Industry and virtually NIL new entrants have entered to specialise in this hugely important field.
For every new Business case being entered, three existing policies are being cancelled, which makes this a dying Business model.
At what point will someone with enough intelligence and capacity to see a problem when it is about to run everyone over, make the obvious decision to move in a manner to rectify this?
This is not a game. This is thousands of people’s lives being destroyed every year because they had no-one to guide them and then it was too late.