The Association of Financial Advisers (AFA) has welcomed the introduction of the Professional Standards Bill today, while also welcoming recent amendments to the bill.
AFA chief executive, Brad Fox, said Minister for Revenue and Financial Services, Kelly O'Dwyer, had also acknowledged the industry contribution during the consultation process and the role of professional associations during implementation of the reforms and assisting advisers.
In noting the requirements from advisers stated in the bill, Fox said it was vital for all advisers to note the key transition dates and start early on attaining required qualifications.
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The AFA also said it was pleased with recent amendments including:
- The flexibility to ensure new advisers learned about advice from experienced advisers during their professional year;
- The professional standards body to include a board seat for a practising educator with relevant experience;
- No carve-outs for large groups like accountants and no exemptions for those highly qualified from the requirement to sit an exam;
- Bridging options for financial advisers with overseas qualifications; and
- Enhanced information sharing between compliance schemes, licensees, advisers and regulators.
The Financial Services Council (FSC) also welcomed the introduction of the bill, adding the reforms would enshrine the terms ‘financial adviser' and ‘financial planner' in law.
FSC CEO, Sally Loane, said: "Raising minimum standards and establishing an independent standards setting body under law will strengthen the trust the community has in financial advisers because these reforms mean that financial planning will become a profession, like medicine, law, and accounting".
The FSC also supported the industry funding model for the standards setting body, adding those governed by the body should help to fund it through a financial adviser funding mechanism.
The Financial Planning Association (FPA) also welcomed the introduction of the bill and asked the key parties collaborate to achieve the best policy, adding those who did not have a degree or equivalent qualification would be required to complete bridging courses as would be determined by the independent standards body by 1 January, 2024.
FPA CEO, Dante de Gori, said: "The FPA will be advocating that those who have obtained the CFP [Certified Financial Planner] designation and/or will obtain the designation after 1 July, 2019 be recognised as an equivalent qualification."
The SMSF Association's managing director and CEO, Andrea Slattery, said the legislation set in place a framework that would raise the educational and ethical standards through a co-regulatory approach, which would allow the industry to take responsibility for its professionalism.
"We look forward to working closely with the new industry standards setting body created by today's legislation. A key priority will be to ensure that the new education standards recognise the importance of specialist advice areas, such as SMSF [self-managed superannuation fund] advice," Slattery said.
"This is especially important as approximately 1.1 million Australians have $636 billion in retirement savings invested through the SMSF sector and often depend on their adviser to assist them achieve their retirement goals."