FPA welcomes PJC Inquiry report to raise adviser education and professional standards
The Financial Planning Association of Australia (FPA) has announced its support of the Parliamentary Joint Committee (PJC) Inquiry report, released today, which aims to raise adviser education and professional standards.
The report champions the need to change current education requirements within the financial planning profession, proposing a lift to professional, ethical and education standards of financial planners in Australia.
Commenting on the report, Mark Rantall, CEO of the FPA, said: “We fully support the findings of the PJC Inquiry report, which are heavily aligned to the recommendations we made to the Inquiry and in the FPA 10 Point Plan around specific improvements to the financial planning profession.
“In particular, we welcome the recommendation that professional associations establish an independent body to set the curriculum for education providers, which is in line with our recommendation that the Financial Planning Education Council (FPEC) fulfil this role.
In summary, some of the other key report recommendations include:
- A minimum degree qualification for financial planners
- The establishment of a Finance Professionals Education Council (FPEC) to set core education standards
- Mandatory ongoing professional development for financial advisers
- The term ‘financial adviser’ and ‘financial planner’ to be enshrined in the Corporations Act, and only individuals registered as a financial adviser can use these titles
The report also recommends that financial advisers have to complete a ‘professional year’, and also pass a ‘registration exam’ to be listed on the ASIC national adviser register.
“The FPA supports the requirement for a professional year, which is aligned with our current experience requirements. However, we will be closely reviewing the recommendation of a registration exam to better understand the parameters and implications for existing advisers and ensure there is no duplication. The FPA has previously not supported the concept of a national competency exam, because we believe it is unnecessary with the raising of entry standards to a degree qualification.”
The PJC has recommended that these measures come into effect gradually over the course of the coming years and that financial advisers will need to comply by 1 January 2019. The FPA supports this timeframe, which will allow the profession sufficient time to prepare.
Mr Rantall concluded: “Today’s announcement is welcome news and yet another positive step forward as we focus on building consumer trust and confidence in Australia’s financial advice community. We are pleased that our recommendations on what the advancement of our profession should look like in terms of minimum degree qualifications to be a financial planner/adviser have been considered.
“We are committed to working with government, industry bodies, financial planners and consumers to ensure we live up to the expectations of our profession and enable consumers to feel empowered and to realise the benefits of trusted financial advice.”