The federal government will not be including a sunset clause in its experienced adviser pathway, leaving open the ability for any advice practitioner with a decade or more of practical experience and a clean record to be considered as a qualified financial adviser.
The decision to not include the sunset clause was made public by Assistant Treasurer and Financial Services Minister Stephen Jones in a recorded address to the Stockbrokers and Investment Advisers Association (SIAA) annual conference in Sydney today.
“The [education and qualification] framework of the previous government would have pushed experienced advisers with an unblemished record to date back to the university or more likely out of the industry,” Jones said.
“Given the growing advice gap, this lacked policy sense and also lacked common sense. As such, I made an election commitment to recognise the experience of advisers with clean records without them needing to return to university,” he said, adding legislation to do this would be soon introduced into parliament.
“This bill will recognise the qualification that comes with a decade of experience while maintaining a clean record on the adviser register. There will be no sunset clause on this qualification.
“I see this bill as providing us with time to manage the transition while we clean up the settings on education qualifications to facilitate the improved pathways for entrance into the system. I’ll be doing more work on the pathway for new entrants over the second half of the year.”
The decision by the government runs counter to the view put forward by the Financial Advice Association of Australia, which claimed the absence of a sunset clause would allow planners in the first decades of their careers to practice indefinitely without seeking any further qualifications.
SIAA chief executive Judith Fox welcomed the announcement, stating it recognised the urgent need to retain experienced advisers within the industry and would not lead to a decline in consumer protection.
“After the debacle of the Financial Adviser Standards and Ethics Authority (FASEA) and the damage it caused our profession, it is really refreshing to see experience valued instead of denigrated,” Fox said.
“We have stressed many times this is not a carve out or watering down of consumer protections. It is an acknowledgement that the current education standards developed by FASEA do not work and the one-size-fits-all approach has been a complete failure.
“The original legislation provided for recognition of prior learning and the government has been forced to act to implement the experience pathway to uphold that legislative intent and to address FASEA’s failure.”