Banks committed to rebuilding trust in advice: ABA
Australia's banking industry wants any new education and professional standards introduced to the advice sector to go beyond "raising benchmark" standards for financial advisers.
In a submission to the Treasury on the Federal Government's consultation on recommendations of the Parliamentary Joint Committee (PJC), the Australian Bankers' Association (ABA) backed plans for the implementation of minimum education standards.
However, the association said the PJC's belief that Australian Qualification Framework level seven (AQF 7) courses would be approved by 1 January 2017 and transitional arrangements for existing advisers, and those that commence study prior to 1 January 2017, to be developed by the standards setting body by 1 July, was optimistic.
"This timeframe would be insufficient to move the financial advice industry from the current requirements to a new education and professional standards model," the ABA said.
"The banking industry believes that the standards setting body should set the minimum entry qualification, including education and competency standards and transitional arrangements.
"Without seeking to pre-empt the decisions of the standards setting body, the banking industry proposes the following transitional arrangements and pathways be adopted for new and existing financial advisers:
1. By 31 December 2019, all financial advisers will hold an approved qualification, at a minimum of AQF 7, as a result of attaining one of:
- An approved degree;
- Other degree together with an approved financial advice bridging course at AQF 7;
- Other degree together with an approved bridging course at AQF 9 (e.g. professional association designationor masters qualification); or
- Other approved learning pathway at AQF 7, AQF 8 or AQF 9, as deemed appropriate by the standards setting body.
2. From 1 January 2020, all new entrant financial advisers registering on the FAR will hold an approved qualification."
In its submission, the ABA backed the PJC;s recommendation that advisers be required to complete a minimum of 40 CPD hours a year, with five hours attributed to ethics components.
However, it said "some accommodation will be needed to deal with particular financial adviser circumstances, such as a temporary departure from the industry".
AUTHOR
Nicholas O'Donoghue
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