No difference between advisers and planners

There is absolutely no difference whatever between a financial planner and a financial adviser, according to Association of Financial Advisers (AFA) chief executive Brad Fox.

Fox has told the Parliamentary Joint Committee reviewing the legislation intended to enshrine the term ‘financial planner/adviser’ that he does not believe that any distinction should be made between the two terms and that the AFA has members who use either or both terms at once.

Discussing the AFA’s submission to the parliamentary committee, Fox said he had also pointed out that a substantial number of people who were capable of being designated both financial planners or financial advisers were not members of the either the Financial Planning Association (FPA) or the AFA.

He said that by the AFA’s estimate, and taking into account the assumed total number of planners/advisers working in the Australian industry, between 40 and 50 per cent were not members of the two major planning organisations.

However Fox said he did not believe that the enshrinement legislation should necessarily be used as a means of forcing these people to become members of the organisations.

“We were asked by the committee whether we thought membership should be mandatory and we said ‘no’,” Fox said.

“We believe it should be in the business of making it attractive for people to be members of our organisation, but we’re not about to suggest it should be a mandatory part of their use of the term ‘financial planner/adviser’,” he said.

Fox said the AFA had also argued that transitional issues would need to be addressed in the legislation covering planners/advisers moving between licensees and those who, due to their lack of qualifications, would have to remove any references to the term.