RG146 upgrades a 'necessary step'

Speaking to ifa, the chief executive of non-aligned group Shartru Wealth, Rob Coyte, said the improvements are “absolutely” needed.

“If the industry [overall] can become more qualified, that will be a positive in the way the industry is viewed,” he said.

“A lot of people are still not using advisers. One reason is because people perceive the industry as a bit of a product flog rather than getting advice based on sound principles.”

The two phased increases from 1 January 2015 and 1 January 2019 will apply to new advisers and to those changing specialisations and will increase on knowledge and skill requirements for advisers beyond the current diploma-equivalent to something more akin to an advanced diploma level and eventually more in line with a bachelor’s degree.

“The industry has to acknowledge the fact that there is a perception problem,” Mr Coyte said.

“In some cases that might be right, in some cases it might wrong, but what we need to do is counter that. These [proposed] measures are best practice anyway.”

Financial Planning Association general manager of policy and government relations, Dante De Gori, said the new measures are part of an “inevitable” shift towards a degree qualification as a minimum standard of entry to the industry.

“There is an expectation of standards from investors seeking financial advice, they want to make sure that person is qualified to a high degree and a degree qualification entry is inevitable in our industry,” he said.

“In any other profession there is a clear pathway. We need to make sure in financial advice, if you want to become a financial planner, there is a clear pathway in terms of your entrance requirements,” he added.