Already the Financial Planning Association, the SMSF Professionals’ Association and the Institute of Public Accountants (IPA) have objected to the budget measure.
In a submission to Treasury, ICAA chief executive Lee White said the cap will discourage Australians from investing in their own professional development and called on new Treasurer Chris Bowen and Minister for Higher Education Kim Carr to abandon the proposal immediately.
“We understand the federal government is under budgetary pressure, but that’s not a licence to produce bad policy,” he said.
“I never thought I’d see the day when the government actively sought to discourage education. It defies evolution, and all sense of logic.”
The ICAA’s position is “well researched and well reasoned”, according to the submission.
The measure will impact productivity, it said, pointing to both the Henry tax review and the Asian Century white paper as outlining the importance of education and training to Australia’s future productivity.
“This policy contradicts both,” the submission stated.
Like the IPA’s submission, the ICAA noted the conflict between government moves to increase education standards across the financial services sector while simultaneously making education and training less affordable.
The ICAA also objected to the level of the cap as being too low. “Estimates show that each hour of professional education costs approximately $120, while a typical annual commitment is around 40 hours,” the submission stated. “This is well over $2,000, without factoring in additional costs such as textbooks and travel.”
Self-employed individuals will be particularly disadvantaged compared with larger firms, according to the ICAA. “It also puts smaller firms that can’t afford to pay for their employees’ education at a disadvantage which discourages competition within each sector,” the institute said.
“The extent of opposition to this proposal speaks volumes, and yet the new government has remained silent. This is their opportunity to right a wrong,” the ICAA’s Mr White said. “Not one organisation has come out in favour of this proposal.
“The major political parties must make their position on the proposed cap crystal clear before the election is announced so the professional community can make an informed judgement on who has the better policy,” he added.
