Parliament has passed a bill amending an error in the law that would’ve seen advisers who were relying on top-up courses to meet the education standard deemed ineligible to continue to practice.
The amendment was passed on Friday in the final sitting period for Parliament in 2025 and comes just a month left before the 1 January 2026 deadline to have an approved tertiary qualification comes into effect.
The amendment to the Corporations Act that created FASEA, the original education standards body later folded into Treasury and ASIC, allowed for transitional arrangements for eligible financial advisers to meet the education standard by establishing an alternative pathway for existing providers to meet the standard without doing another full degree.
Under the alternative qualification pathway, an existing provider can meet the qualifications standard by completing the necessary top-up courses and requires the completion of between one and eight additional units of study, depending on the qualifications already achieved by the “existing provider” (defined as a relevant provider who was on the ASIC Financial Adviser Register at any time between 1 January 2016 and 1 January 2019).
But the Better Advice Bill – which passed in 2021 and legislated the end of FASEA – inadvertently removed access to the alternative qualification pathway.
Financial Advice Association Australia CEO Sarah Abood said the association welcomed the change and that it ensured continuity for advisers who have followed the alternative pathway in good faith.
“Among the number of financial advice reforms being progressed in Parliament, I am particularly relieved that the technical wording issues in the Corporations Act around qualification requirements for existing providers have now been fixed,” Abood said.
The update doesn’t affect advisers with an approved degree or those using the experience pathway.
Former Minister for Financial Services Stephen Jones campaigned on an education carve-out before Labor won the 2022 election, which became law in 2023.
ASIC has warned the industry that there were likely thousands of advisers who haven’t updated the Financial Advisers Register to reflect they have completed the education standard or are eligible for the experience pathway.
An update from ASIC on 1 December said 2326 advisers have yet to meet the education standard according to data currently recorded on the FAR. There are 836 of those that may be eligible for the experience pathway, but their licensees are yet to notify ASIC.
According to analysis of the FAR from Padua-owned Wealth Data published on Friday, 5179 advisers intend to use the experience pathway, 6469 advisers say they won’t use the pathway and 3981 have provided no information.
However, those responses total 15,629 adviser entries, exceeding the actual adviser population of 15,459 due to multi-authorised advisers supplying conflicting data to ASIC, according to Wealth Data.
The researcher has forecast a “best case” adviser population of 14,567 in 2026, 892 fewer than the 15,459 currently registered as of this week.
Worst case scenario modelling means that up to 1600 advisers could leave at the start of 2026, with the most realistic outcomes falling between 1100 and 1500, according to Wealth Data.
“With the 1 January 2026 education standards rapidly approaching, the data shows the financial adviser market is on the verge of a significant contraction and one that will redefine adviser capacity, business models, and consumer access to advice,” Wealth Data manager Colin Williams said.
Earlier predictions this year suggested around 1000 would leave the profession after the education deadline.
