The Association of Financial Advisers (AFA) is calling on the Government to implement the association’s proposed changes to the experience pathway before the next election.
Speaking to members, AFA chief executive, Phil Anderson, said the association’s proposed “compromise” did not require legislative changes but could instead be implemented by Senator Jane Hume, minister for financial services, superannuation and the digital economy.
“However, 2022 is an election year and we want this to be resolved before the election,” he said.
As there was a minimum campaign period, the election needed to be called by 18 April in time for the 21 May deadline.
The AFA recommended an experience pathway based on advisers with more than 20 years’ experience being able to do a four subject Graduate Certificate, with two subjects credited at commencement.
Those with more than 15 years’ experience but less than 20 under the AFA’s proposal would only have one subject credited while those with less than 10 years’ experience would need to do a full Graduate Certificate.
As it stands, the Government’s proposal would only require advisers with more than 10 years’ experience do one ethics subject. Those that would not be eligible for the experience pathway could opt for the ‘graduate pathway’ which would require a bachelor’s degree.
The AFA wanted the Government’s proposal to require those undertaking the qualification pathway to do eight core knowledge subjects relating to financial advice and a bridging course for someone who had not done the eight core knowledge subjects.
“The way it’s proposed at the moment, you could just do eight accounting subjects, or eight law subjects and you would technically meet the standard,” Anderson said.
The association also opposed a cap on FASEA exemptions, opting to uncap it or increase it to four, and recommended a Government-funded apprenticeship model for Professional Year advisers.
In developing its submission, Anderson said the AFA targeted six key objectives including retaining advisers in the industry, achieving public recognition of financial advice as a profession, not having regrets in five to 10 years’ time and supporting the academic community.
Citing a survey of 530 AFA members, Anderson said the AFA’s submission to Government was to address the 20.8% of members who did not intend to undertake further study and the 15.2% of respondents who had not undertaken any qualifications before planning further study.
“If there is more reasonable recognition of prior learning and experience then this is the group who may change their mind and decide to do some further study in order to stay in the profession,” he said.
Meanwhile, 54.7% said they supported the proposal, 22% believed the Government’s experience pathway undermined recognition of financial advice as a profession and 8.6% said they had already done necessary study and thought it was unfair. A further 14.7% thought minimum education standards should be lifted and some further study should be required.
Of those that had FASEA qualifications already, 43.4% did not support increased recognition of prior learning while almost all people without qualifications did.