Andrew Gale has been a member of the SPAA board for nearly two years now. He tells Darin Tyson-Chan about the opportunities to continue to grow the body’s membership and the need for more measured debate to formulate sound medium-term policy for the industry.
How did you get started in the SMSF sector?
When I was running Deloitte Actuaries and Consultants, one of the key roles I had there was, at the building stages, being one of the co-architects of its superannuation model that gave a really good forward view of the superannuation sector over a few decades. Coming out of all of that was the indication just how strong the prospective growth of SMSFs was going to be. Then I got invited to present the results of the Deloitte research at the 2009 SPAA (SMSF Professionals’ Association of Australia) National Conference. Subsequently I think I’ve presented at three of these events. When I left Deloitte to become the chief executive of Count Financial, the advice network, being mainly accountancy based, was very strong in the SMSF space, consolidating my involvement in the industry. In fact, while I was chief executive of Count, I had a fairly strong focus on encouraging a lot of the Count representatives to become SPAA members because I had a really high regard of the association as a professional body. Subsequent to that, when I finished my role at Count Financial, [SPAA’s] Andrea Slattery and Andrew Hamilton asked me to join the SPAA board, which I ultimately did in March 2012.
So how did the invitation to join the board arise?
I was well known to some of the existing directors, but especially to Andrea, the chief executive, and Andrew, the chair, and I also had some profile with SPAA through my involvement in some of those conferences. I’ve done a fair bit of strategic work on the industry side of things as well, so it basically came about that way. Organisations always look at what value you can bring to the board and I think they saw I could help in terms of strategic input.
Do you have any specific responsibilities as a SPAA board member?
Well, I think the important thing with a body like SPAA, and this is my view on most organisations, is distinguishing the role of the board and the role of management. I’ve got a fairly strong view the board has a role centred on governance, risk management, either side of strategic direction and the like. But in terms of developing a strategy, executing on a strategy and executing on a business plan, that’s the responsibility of management. So do I have operational responsibilities? No, because that properly resides with management. I’m on the finance committee and I do provide hopefully useful input at a board level.
How have you found the growth of SPAA since you’ve been involved with it?
If you look at the growth for SPAA over the last 10 or 11 years, it’s been phenomenal. Our membership is around 2800 and roughly half of those are specialist members. We think there’s lots of future growth as well, especially with some of the licensing changes happening on the accounting side of things. I think that will provide some fairly strong growth in due course.
Do you attribute the growth to anything in particular?
The growth and success, especially with things like the national conference, comes down to the quality of it. The feedback you consistently get is delegates appreciate the program and the rich content available through both the themed sessions and the concurrent sessions. The ratings that we get on the national conference, in terms of satisfaction, is just extraordinary. I can’t recall the exact figures, but I think the satisfaction rating was up around 90 per cent and that’s really strong positive feedback. Getting that sort of feedback from a major conference is pretty amazing.
Does SPAA have any specific strategy to target the new licensees from the accounting fraternity and make them members?
With the removal of the accountants’ exemption, and bringing the licensing requirements in by 2016, there have been various estimates about how many additional players it will bring to the market. Typically those estimates are between the 5000 to 8000 sort of range, in terms of potential additional number of licensees in some capacity. These people are probably from good-quality accounting firms and strong in the SMSF space and we would certainly hope for a good portion of them to become SPAA members. We’ve also created an additional membership category for those who aren’t in client-facing roles, which is the affiliate membership category. I think there will be strong growth there too.
Are there any areas the board has identified where more work is needed?
In terms of talking about detailed policy for SPAA, it’s best left to Andrea as chief executive and Andrew as chair. In broader terms, our aim is to be the pre-eminent, perpetual body for the SMSF sector [and] we already enjoy that position. I think part of that arises as a result of our singular focus on the SMSF sector. As well as this we have an integrated approach, meaning there are a range of professionals involved. You’ve got the accountants, planners, lawyers, actuaries and service providers, so there is that cross-section allowing a focus on really high professional standards on the education and continued professional development side. I think what you will expect to see is we will continue to advocate for high professional standards and if there are areas in the industry we think there is scope for things to be strengthened, we’ll continue to advocate for that.
How hard is it to maintain SPAA’s position as the leading professional body in the space?
You never rest on your laurels, but the unique selling properties of SPAA is its overall focus on the SMSF sector and all things that give rise to high levels of practice for professionals. There are a lot of members where SPAA is actually their secondary membership. So a lot of the accounting-based members might be a member of CPA Australia, the Institute of Chartered Accountants in Australia or the Institute of Public Accountants and have these as their first professional membership, but to the extent that they want to specialise within the SMSF space, I think they’ve already voted with their feet in terms of saying also being a member of SPAA makes a lot of sense. If you look at the financial planning sector, obviously there are a lot of people who are members of the Financial Planning Association or the Association of Financial Advisers, but then again those members who really want to understand the particular intricacies and requirements and demands of the SMSF space have already become members because they see a lot of value in both having that specialist support provided by SPAA, but also the accreditation and recognition of the brand that goes with it.
What’s the biggest change you’ve seen in the sector?
The growth of the sector is an obvious one. I’d say probably the biggest change I’ve seen in the last five years is the professionalism of the sector across a whole range of areas. That includes the involvement of the accountants, or planners, or the involvement of lawyers and that’s where SPAA is pretty well placed to ensure that professionals are servicing the sector well with the right standards. I think that has been happening relative to where the sector was at five to seven years ago and where it is now. So I’d say the professionalisation of the sector.
If you could change one thing about the sector, what would it be?
A slightly broader response to the question is what I would like to see is an increased focus on what constitutes good medium-term policy across the superannuation sector in general and with that a much more balanced debate than we’ve seen to date. Often there have been people advocating from their partial positions that are starting from an inaccurate fact base. For instance some of the figures bandied about based on Treasury figures on the cost of concessions are looked at from a really narrow sense. No allowance is made for all of the offsets, like the reduced demand on the social security system, and the derivation of those figures quite frankly completely overstates what is the foregone revenue to government. So if we’re going to have a good debate on sound policy, which I think is required, then we first need to start with a much more balanced set of figures rather than the headline-grabbing numbers.
What’s the biggest challenge for the sector over the next year?
I think the SMSF sector does require specialist advice, so it’s in the interest of the sector and those operating it to make sure they have the requisite particular expertise and education and professional standing to provide advice in that sector. So the challenge is for advisers to get more actively involved in terms of education, professional standards and the continued professional development framework to support their endeavours there.