FPA wants limits on planner designation

The Financial Planning Association (FPA) has called for a robust mechanism to limit the number of people who can call themselves financial planners.

The call is contained in the FPA’s submission to the Parliamentary inquiry into Financial Products and Services, which also argues that “those who are qualified to use the term ‘financial planner’ should undertake professional obligations over and above the requirements of the law”.

In doing so, the FPA has made clear its intention to develop as a professional body, arguing any new requirements should also enshrine a fiduciary responsibility “along with ethics and integrity in their interactions with clients, effected by a legal regulatory mandate to join a professional body”.

The submission also calls for amendments to regulations to recognise the role of professional bodies in co-regulating planners.

In another key recommendation, the FPA has also called for the tax deductibility of advice fees, including consideration being given to a tax rebate of 30 per cent on a fee up to $2,000.

In what also appears to be a reference to the industry funds' 'compare the pair' television advertising campaign, the FPA submission calls for a tightening of advertising controls to ensure truth in advertising and the use of appropriate and realistic assumptions.

It said the Government should also work with product providers and research houses to establish a comprehensive system of rating for product risk that ensured disclosure of key product risks.

On the question of professional indemnity insurance, the FPA submission said the retail client compensation system had fundamental flaws and should be urgently reviewed through extensive public consultation with industry, consumers and other stakeholders.