Education pathways ‘common sense’: SAFAA

The Government’s education proposal is “really good common sense” and will help curb clients being orphaned by a further mass exodus of financial advisers, the Stockbrokers and Financial Advisers Association (SAFAA) believes.

The ‘experience’ pathway would allow advisers with 10 years of experience to be exempt from completing a degree to continue practicing.

SAFAA chief executive, Judith Fox, said it was the intent of the legislation to take prior learning and experience into account but that it was the Financial Adviser Standards and Ethics Authority (FASEA) that did not recognise the value of decades of continuing professional development.

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“We think it's really good common sense that if you've got deep experience, you've had clients, you know, for a long period of time, you've got an unblemished record, you've passed the national exam [to be exempt],” she said.

“It also means the clients aren't going to be disadvantaged because they're not going to be orphaned by a further mass exodus of advisers.

“It's a transition issue because those coming into the industry now will all have a degree. If we had a further mass exodus of experienced stockbrokers and investment advisers, it's just going to exacerbate the current problem, which is that we have an unsustainable advice sector and that has implications for retail investors.”

Fox noted she understood there were some advisers who had already done the study and might have felt the exemption devalued their effort but said that relevant education was always valuable where advisers and clients were the beneficiaries.

“Financial planners want to be recognised as a profession and I do understand that people really feel that somehow these changes are going to mean that they're not going to be recognised as a profession but that movement doesn't happen overnight.

“It is something that takes place over time and every new entrant will come in with a degree. But the idea that we would just see a further exodus of experience means no one can mentor the next generation.

“For stockbrokers in investment advice that mentoring is key because they've gone through the Asian Financial Crisis, the market crash of 1987, the Global Financial Crisis, so they're exactly the people you want in the room when the next market correction hits to mentor the next generation.”

Fox said that kind of experience was not learnt at a university and that the industry would want to keep its experienced advisers during this transition period.

“I think people are angry because they think somehow that they're going to be not seen as a profession, but that is taking place and the professionalism of all parts of the financial advice industry is obviously underway,” she said.

While Fox said SAFAA was supportive of the proposals as they stood and were open to suggestions of what other associations would put forward.

“Part of the challenge is that FASEA took a one size fits all approach but the financial advice ecosystem is very broad as it incorporates a whole range of different financial advice services,” she said.

“Unfortunately, I think we've seen a one size fits all approach just doesn't work and that creates a challenge for Treasury. But I think we've all seen how a one size fits all approach is not helpful.”


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It feels like her message is a bit inconsistent.

She's saying that experienced advisers shouldn't have to do the extra study - but that "relevant education was always valuable where advisers and clients were the beneficiaries".

She also talks about the advisers who've been "through the Asian Financial Crisis, the market crash of 1987, the Global Financial Crisis" - but the current suggestion is for experienced advisers who have more than 10 years experience, which would pick up a lot of advisers who haven't gone through any of these.

Though I do wonder how many financial planners this is all this relevant to? It's getting a lot of talk, but this late in the game, how many advisers haven't started any study at all?

The rather poor part about all this is the biggest and loudest advocators for the 'experience exemption' are the industry associations. Of course they are in support - they want adviser numbers to be as high as possible so they can keep receiving those sweet, sweet membership fees that just roll on in because they have to.

When accountants swapped to a uni degree about 50 years ago, the grandfathered all existing qualified accountants. I know one who still runs his own practice and his only accounting qualification is a TAFE certificate in accounting. As far as I know, no profession has ever done what the government is doing to Financial Planners. Why are we destroying the industry when no other profession has ever been insane enough to force a large proportion of their experienced members out. Imagine the reaction if we said to all doctors that any qualifications more than 10 years old don't count & you have to go back to uni and do another degree

When accountants swapped to a uni degree 50 or however many years ago it was, it wasn't possible to complete study completely in your own hours, from a location of your choosing, accessing textbooks remotely via a computer or tablet, from a large range of tertiary institutions.

We don't need to do a 1970s transition when we have 2020 capabilities.

we don't want to do what the accountants did. they aren't very good for us to want to emulate them.

What a joke...
Well done to everyone that managed to do that right thing and get things done for the future and betterment of the industry. Shame to be held back by these other people...

BREAKING NEWS: Industry body representing uneducated cowboys opposed to mandated education!

well said

Being a bit harsh there I think ! Anyone who has run a business as difficult as this can be for 10-15 years without a blemish and successfully provided advice must be doing something right ! Degree or no degree !

Would you have the same view if we are talking about doctors, flying in a plane, drinking tap water, driving across a bridge? Professionals have tertiary qualifications. By not doing the exams, they have shown they are not capable of being professionals.

We are not talking about doctors we are talking about professionals with decades of experience who did the education in their day that was available and successfully turned it into a business they are admired in by their clients I’m not saying don’t educate yourself I’m saying they are successful! If not they would have been gone years ago

Success in business and monetary terms does not in any way preclude that person from being inherently unethical.

Unfortunately in society those willing to be unethical generally outperform others that aren't.

Success is also not just about money.

A successful business is also one where the clients keep turning up to use the products and/or services and pay the fees along the way.

You need to stand back and look at the discussion in more detail to understand what others are saying sometimes to be able to see the bigger picture.

Your last line does have merrit if we are just talking about financial success.

Yes of course, that's the point I'm making. Success should not be measured purely in financial terms. However, what I was responding to was the people against the education uplift with their reasoning being that their business is 40 years old and is successful. This gives no information about the quality of the advice whatsoever.

You keep referring to experienced advisers as having started or run their own business - but this would be the minority. A carve out for them would be a different matter.

There’s plenty of other financial planners who’ve (as an example) been in for 10+ years and bounced around the banks or other licensees - providing poor quality advice but not sticking around long enough to be held accountable. Why should they be exempt from the education requirements?

They should not.!
If you have not run your own business then how would you ever get the experience required. Working for someone and " bouncing" around as you put it does not give anyone the whole picture. And that comes down to the poor education that the banks provided.
Some years ago I was asked to address a group of "bankies" from all over the state { NSW } as their retention rates were disaterious. This was done over two days in The Hinter Valley and to be totally honest I was "HORRIFIED" at what they did not know and what they thought they could do.
Those who work for themselves understand the importance of keeping up to date with legislative and policy changes. They don't need a 4 year degree to service and look after people with basic life insurance needs. EG Specialist Risk Advisers. This was the whole issue from the word go. When FASEA was established and ran "amok" for three years promoting one size supposedly fits all ! Well! guess what ? It dose not!.
If this had been done initially we would not have everyone now having a "winge" that they have spent all this time and money on education and how dare some advisers be excluded
Sour grapes I fear.

So you’re not saying you think “experienced advisors with 10+ years experience” should be exempt from the education requirements… you’re saying that the definition of “experienced advisors” should be expanded to more than just having 10 years of basic experience?

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