In its submission for the Financial Adviser Education Standards Consultation Paper, the Joint Associations Working Group (JAWG) said it supports a modification to the existing adviser education framework.
JAWG includes the key associations representing advisers and financial services including the SMSF Association, FPA, and AFA.
The submission stated that the experienced pathway should be available if the adviser has passed the exam and is able to demonstrate 10 years of full-time equivalent experience over the period from 1 2004 to January 2022.
The requirement to have a clean record to access the pathway must be based on an objective and reasonable test, the submission stated.
“A suggestion is to align with the ASIC reference checking protocol Section 3 ‘Conduct of the representative’,” it said.
JAWG said the framework should also require advisers to complete an approved ethics subject by 1 January 2026 or be a voting member of a non-profit associations with a code of ethics, mandatory CPD obligations, and a complaints and quality review system.
It has also recommended that the experience pathway include a sunset clause which ends 1 January 2032.
“Any adviser who wishes to continue to practice post this date would need to meet the education requirements for existing advisers,” it stated.
The submission has also called for a review of the pathways for existing advisers and career changers to ensure education provide value and relevance to both the adviser and their clients.
“The JAWG recommends that a holistic review of the education pathways be conducted including appropriate recognition of prior learning, quality education, certification, experience and competence available at the time of completion,” the submission stated.
JAWG said the units and learning outcomes for each unit should be set and approved by a recognised independent authority which can assist universities to design units, approve units, and maintain a list of approved units.
“The approved independent authority should be a not-for-profit organisation that includes representatives from academia and professional associations which meet the criteria of point 5b. above, financial advisers and licensees,” it stated.
“The authority should only charge on a cost recovery basis for the approval of courses and operate for the benefit of the profession, with all representatives providing their time on a voluntary basis.”
Existing advisers and career changers, the submission said, should be provided the choice to complete the current FASEA pathway or the new revised experience and qualification pathways once finalised.
The submission also said that existing advisers who are registered tax agents with the tax practitioners board or were temporarily deauthorised on the FAR due to a career break or change f licensee at 31 December 2021 and were not ‘deemed’ onto the FAR should not be required to complete additional study.
The submission noted that consumer need for financial advice is increasing, particularly with over 100,000 individuals a year expected to move into retirement each year over the next five years.
“In recent years there has been a massive exit of highly experienced advisers, which is expected to continue if current settings are not adjusted, resulting in access to quality, affordable advice becoming harder for consumers to obtain,” the submission cautioned.
