Migration a ‘valid pathway’ to address adviser shortage: FAAA

In its submission to the Department of Home Affairs’ review of the points test discussion paper, the Financial Advice Association Australia (FAAA) said there is a dire need for more new entrants to financial advice, as evidenced by its inclusion in the Skills Priority List.

“Australia uses a points test which attributes weightings and a pass mark to tailor the points tested visa programs. This reflects Australia’s long-term labour market needs. We invite independent migrants to apply for a visa based on their skills, attributes, and suitability for employment,” the Department of Home Affairs said.

“The points test objectively compares candidates’ skills sets and attributes needed to succeed in the Australian labour market and society.”

Chief among the FAAA’s recommendations in its submission is a greater recognition of the professional year for financial advisers.

“FAAA suggests migration is a valid pathway to help address this skills shortage,” chief executive Sarah Abood said in the submission.

“We also suggest that the ‘points test’ should be amended to more appropriately reflect the mandatory education and training standards in the Corporations Act, which an individual must meet in order to secure a role as a financial adviser/planner.”

The FAAA argued in its submission that while tertiary qualifications are “well recognised in the migration system”, the professional year is not recognised even though it is a “legislated requirement that must be completed to find a fulfilling job as a financial adviser/planner and generate successful labour market outcomes”.

“This disincentivises migrants from considering the occupation of financial adviser/planner as a future career in Australia, adding to the long training gap and skills shortage issues,” it said.

“This is reflected in data about applicants seeking assessment of their foreign qualifications against the Australian Qualification Framework, which indicates a downward trend in those interested in a career as a financial adviser/planner.”

In contrast, the Accounting Professional Year Program is recognised under the points test and has similar “competencies and job readiness outcomes” as the financial adviser PY.

“Under the current points test, the Accounting PYP provides five points to graduates in accounting. A similar PYP exists for graduates in engineering and ICT, which also received five points,” the FAAA said.

It added: “The FAAA recommends the Work and Training Professional Year Standard for financial advisers/planners be allocated five points in the points test.

The FAAA also argued that the completion of the financial adviser PY is a strong indicator of commitment to working in the profession long term, noting that around 83 per cent of the new entrants who have completed these requirements since they were introduced on 1 January 2019 continue to work as a financial adviser today.

“The professional year is also a substantial commitment by employers. The PY is seen as an investment in the future workforce of the firm. Employers that employ migrants to undertake their professional year require certainty that the individual will have the ability to continue to work in Australia following the completion of the PY,” it said.

“This would greatly assist in attracting appropriately skilled migrants to choose the occupation of financial adviser/planner and facilitate successful labour market outcomes for migrants.

“The migration system should play a role in addressing this skills shortage to meet the financial needs of Australians in a culturally diverse and ageing population.”