ASIC Senate Inquiry recommendations support FPA 10 point plan
FPA’s call for world’s best professional standards heard by the Australian Senate on behalf of all Australians
Today’s findings of the Senate Economics References Committee Inquiry into the performance of the Australian Securities & Investments Commission’s (ASIC) handling of Commonwealth Financial Planning Limited vindicates a strong and comprehensive position forged by the Financial Planning Association of Australia (FPA) on behalf of its members and all Australian consumers.
The Senate Committee Inquiry has accepted the majority of the 10 relevant recommendations made by the FPA in its landmark 10-point plan.
Australia’s complex financial system demands robust legislation, a strong and effective regulator and personal financial advice outcomes that benefit, and are trusted by, all consumers.
Appropriate financial advice is a matter of national importance, as indicated by the mammoth task to boost enduring self-funding levels amongst Australia’s ageing population.
Against this backdrop, today’s Senate Inquiry report further underscores the need for an efficient co-regulatory model with approved professional bodies handed greater powers of monitoring and supervision of all financial planners/advisers.
“The evolution of Financial Planning as a respected profession is critical in providing a consumer-centric approach to reforms befitting our professional members,” said FPA CEO Mark Rantall.
“We are pleased that the inquiry has included all of the FPA’s recommendations in their final report. The FPA is committed to stamping out inappropriate advice outcomes rooted in complex product distribution and conflicted remuneration practices, while offering viable solutions based on what is right about appropriate financial planning.”
Mr Rantall welcomed the findings of the Senate Inquiry and acknowledged that the commitment of the FPA in its public submissions to raise professional and educational standards, highlight systemic industry failures, and deliver appropriate, consumer centric solutions had been heard.
“The Senate Committee Inquiry commenced just over 12 months ago, yet the FPA’s 2010 decision to overtly align its activities with the public interest is a tangible pointer to our future obligations. It drew a hard line from which we will lift standards of behaviour and accountability for those who seek to advise on other people’s money.
“It has required a fundamental prioritisation of educational and professional standards aligned under an enforceable code of professional conduct.
“The FPA’s professional code has been embraced by the independent consumer watchdog, the Financial Ombudsman Service, and presents world’s best practice.
“We are therefore pleased to see all of this hard work – and our subsequent public position – validated by the Australian Senate in its milestone findings today,” Mr Rantall said.
Mr Rantall said it was now high time to investigate and deliver the pre-requisites for all Australians to renew confidence in their dealings with anyone who uses the term “financial planner” or “financial adviser”. We acknowledge the committee’s recommendation to have the term Financial Planner/Adviser protected in law.
“FPA welcomes the Senate Inquiry recommendations to lift educational and professional standards for financial planners.
“In terms of education, the heart of our published 10-point plan is to phase in appropriate degree qualifications for new financial planners over five (5) years together with membership of approved professional associations with approved codes of professional conduct. We are pleased that the committee has seen fit to adopt this recommendation.
“The days of completing a $2,000 two week course to be licensed to provide personal financial planning advice should be long gone,” Mr Rantall said.
“The FPA stands with Australians for a better financial future. A future that delivers trusted advice.”