Financial advice industry bodies have raised objections to ASIC’s proposed national certification test, with one association calling for its removal and another saying its own qualifications are rigorous enough.
The FPA said in its submission to ASIC on consultation paper 153 (CP153) that it broadly supported a nationwide examination, but wanted certified financial planners (CFP), which it represents, to be exempt.
The FPA and the Association of Financial Advisers (AFA) have both made submissions to ASIC, which wants advisers across the country to pass a national certification test.
FPA general manager of policy and government relations Dante De Gori said the organisation broadly supported the push for a standardised national test but its members were already highly qualified.
“As the CP153 is currently written, we would be requesting that CFPs are exempted from doing the examination and we explain why,” De Gori said.
In its submission, the FPA outlined the involved study required of CFP candidates, who must first have a university degree.
The AFA opposed the test, AFA national president Brad Fox said.
“Our concern is around duplicating costs and assessments across the industry,” Fox said.
“We think that in a number of ways what was initially proposed we don’t think would necessarily raise the bar.”
ASIC had no comment on either view, an ASIC spokesman said.
“We are currently reviewing the submissions. The final regulatory guide will take into account this feedback,” he said.
ASIC said it was drafting regulatory guidance on CP153 and planned to release final guidance in August.
With CP153, the corporate regulator wants to remedy concerns over whether advisers are keeping pace with minimum levels of competence required under RG146, the recognised minimum standard.
The centrepiece of ASIC’s three-stage assessment is a national adviser certification examination.
Once an adviser passed the test, they would be monitored by a supervisor with at least five years of experience.
To keep skills up, a financial adviser would conduct an online update within two years of passing the certification test, and repeat the update every three years after that.
Fox said the ultimate test lay with the consumer.
“In terms of a consumer learning whether an adviser is licensed, that’s something that’s available on the ASIC website. Whether an adviser is a good fit with a client or whether they’re the best financial adviser in Australia or whether they’re just an average, ordinary adviser, that’s not the role of ASIC to test.”
The Australian and New Zealand Institute of Insurance and Finance also opposed a national exam, arguing it would ultimately raise costs to consumers.
“Quality education and exams at the education provider level with audit to weed out substandard providers is the key,” it said in its submission to ASIC.
