AFA meeting with the Minister for Revenue and Financial Services and an update on FASEA

Philip Kewin

Further to our recent communications, there have been a number of consultation papers issued by FASEA regarding Professional Standards including the National Exam that has to be successfully completed by all advisers no later than 31 December 2020.

We have a number of serious concerns about the proposals and the negative impact they will have on the future of advice and the impact on the broader community.

On Monday, we met with the Minister for Revenue and Financial Services (Kelly O’Dwyer) to explain our concerns with respect to the FASEA proposals on Professional Standards.

We specifically addressed our concerns with the education standards, including the definition of a related degree and the lack of recognition for unrelated degrees, Advanced Diplomas (or DFP 1- 8), and professional designations.  We also took the opportunity to express our concerns about the potential impact upon the financial advice profession if a practical solution could not be found.  We asked the Minister about what the Government expected the outcome would be and the Minister clearly stated that there was no target for adviser attrition.

We also discussed the National Exam and the fact that there was a lack of detail on content, up to four hours, closed book, 65% pass mark (75% for ethics questions) and a lack of preparation materials or practice exams.  The Minister expressed a view that this appeared to be unreasonable.  She did make the point that this was a consultation process, however we noted that consultation should not be run on the basis of ambit claims and unreasonable expectations as the starting point.

The Minister noted that FASEA was an independent body, however she agreed to discuss our concerns with them.

Please click here for a copy of the FASEA Exam Consultation Paper and our submission to FASEA on the National Exam.

We are very conscious that many of our members are particularly concerned about the proposals from FASEA.  We will continue to respond to the ongoing consultation process with FASEA and have sought  to meet with them directly given the limited number of formal consultation forums.  We will also discuss our concerns with other groups and politicians in the lead up to the release of any further consultation and the finalisation of the requirements in coming months.

We accept and support the need for an increase in professional standards, including the minimum education standard.  The National Exam is part of the Professional Standards legislation, however it needs to be a sensible target and the Government, FASEA and the rest of the sector need to commit to helping adviser pass this exam.  This whole process needs to be about raising standards, not about reducing adviser numbers.

We welcome your feedback on the FASEA proposals and the advocacy actions to achieve a more practical outcome on all these key elements [email protected].

By Philip Kewin, CEO