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.”
20 years industry experience and 10 years paraplanning and associate. Current employer dancing carrot for PY but I don’t believe it’s going to happen. He needs my technical knowledge for his junior advisers (succession plan)
I can’t get PY year in job interviews as too old and they want young ones. I have so much knowledge and experience and Grad Dip (AQF8) and will forever be stuck not reaching adviser qualification due to the PY year.
I’ve spoken to others and employers not offering PY year.
Well you’ve got to have new members coming in at least quicker than the ones that are dropping off to keep FAAA’s fargone ponzi scheme going.
Honestly, there may come a time where I get offered a role out of this industry. That date may be sooner then later. Perhaps its time to say good bye
Stopped paying my CFP membership last year.
The organisation has delivered nothing for advisers this is another example.
The PY and degree requirements that are too tight and killing new entrants into the industry. How about you fix this before importing advisers from overseas.
The sad thing is these backpackers will be called Qualified Advisers.
Thankfully I made the decision this month that I will not be renewing my membership and save $1,000 a year. I read this and thought my decision has been justified.
Absolutely … a complete farce .. FAAA just so completely out of touch ..
The FAAA are losing members faster than they can sign new ones up must be a worrying trend for them…?
Omg what the hell are the FAAA doing. It would be funny if I didn’t pay them $1.5k a year, diabolically misguided, overreach of a suggestion and against all their present members interest. Worst professional association even, completely ineffectual for actual advocacy the pontificate in this rot. Go back to basics and advocate for your current membership or make CFP ongoing for grads and see how many voluntary members you have…
This makes a joke of the current advisers doing their PY and all the challenges that have faced because the old school chop shops couldn’t help themselves when treating clients like ATMs. Where was the FAAA then…?
Assuming all these migrant advisers will have approved degrees and will be able to land themselves a Professional Year gig as soon as they get here, right? Right?
Clowns to the left of me, jokers to the right,
Here I am, stuck in the middle with you.
Who is the FAAA? Are they really representing us? Come on – this is not the answer. I think we need to a real Industry Body that know what to do and how to do it, and stop the bs that is going on. Tell the ‘red tape’ people to go away and we will ensure that we are doing it right. We govern ourselves. This is garbage and not sure why we are even giving this the time of day.
You need to create some incentive for small business owners to take on PY candidates and for the large licensees to take on PY candidates.
I have 6 years in financial planning as an associate, I have studied a Bcom (Finance), CFP(non practicing), Masters of Financial Planning, SMSF specialist advisor and I have gone for many job interviews and they all want me to work for them for a number of years and then may potentially offer a PY.
I understand employers need to see if I am a right fit and it will cost them to take me on for the PY but you have a huge talent pool currently here.
but its employers who are the one who decides if they want to start people on the PY. I have decided to go work for a large super fund as they are actively taking on people for the PY
I would like to hear comments from business owners as to what is stopping them taking on PY candidates like myself? (alot of my colleagues have similar experience and education and they have faced the same issues with starting the PY as me)
There’s a fear you’ll work one year and then leave.
leave to go where? If I start at a firm as a PY why would I want to leave
Upon completion, there is a fear you’ll leave. The cost of wages and time and cost spent is a large investment in you. You come across as “wanting” a PY year straight away. It’s quite typical for someone to go to Uni and have this immediate expectation on day 1 to start being a planner. In reality I would want someone to work with me and serve an apprenticeship then onto PY year and I’d hope they stay for 5 years to recoup my significant outlay.
Im not straight out of Uni, I have worked 6 years in financial planning, the cost of wages and time spent training is a risk with any of your staff, receptionist, paraplanner CSO
Cost.
There are huge costs of not only employing, but licensing a young PY adviser who there is no guarantee will be able to generate sufficient revenue to provide a ROI.
That, and the fact that so many young ‘advisers’ now don’t understand the very simple reality, which is that all the qualifications and technical expertise in the world really don’t matter that much in an adviser, what matters most is soft skills, life experience and psychology.
Most young qualified advisers I meet these days confuse their ambitions with their capabilities and do not have the humility or maturity to accept that despite being well qualified, they actually don’t know anything about anything that really matters, and because they don’t see this, most are not open to learning and growing. I don’t want to hire a highly qualified over confident young person with unrealistic expectations about salary. I want someone who will be a sponge and soak up my wisdom and understand that is more important, are more valuable, than $ in years 0-3. Not everyone is this way, but in my experience it’s the majority, and seasons business owners don’t want a bar of it.
I have always told them that I am happy to learn and the thing I want to learn most is soft skills as I join them in meetings,
anyway thank you for all of your responses but I think joining a large super fund was a wise choice instead of trying to learn from experienced advisers who run a small business
if none of you are willing to train up someone like me who has education, experience in the job for many years, than you also on the other hand cant complain that the government is allowing large super funds to have their own advisers because you are not bringing in any new advisers
Large super funds are likely better positioned to fund you – guess where they get they money?
Good luck with that. They only thing you’ll learn working for a large super fund is how to be a robot & how high you need to jump when ordered to.
well if no one wants to pass on their experience and have the time to train me or take on the cost what other options do I have
Well, the rules were written purposely to create the environment you’re in. The Government didn’t consult with Advisers. The rules were written by Academics on FASEA facing redundancies needing to sell more Uni Courses. So your disappointment is mis-directed
Having worked in that Super fund environment, and Banks and Private Sector, I can attest at least you’ll be trained in Sales skills, and the pressure to meet a Sales target and retain FUM, was most intense in Super funds. You’re totally wrong in that plenty of Advisers want to train up Advisers. My advice is gain some experience in that sales focused, Brainwashing, cult like Super fund, but get out after end of Year 2.
If I am wrong why do the majority of responses on here say that no advisers are willing to take on PY candidates and the numbers also show that of such low PY candidates coming through, I totally understand that the industry has been screwed up by regulation/FASEA but if you dont want to pass on your knowledge and experience dont be surprised if there are no holistic independent advisors anymore and new entrants just join super funds and push their own products
And who do we thank for that? You seem to be blaming Financial Planners themselves?
You are too qualified – and expensive. I empathise with you but the prepatory coursework and academia to “lift professional standards” has destroyed the practical applications all that theory was based on.
I’d tell you to start your own business but even that’s has been made nearly impossible for you despite your obvious knowledge and competence.
Too qualified? I was asking for market rate of pay
You seem to have an awful lot of qualifications, including the highly dubious “CFP(non practicing)”, for someone who has never worked in the field. To me that’s a big red flag you may turn out to be a self righteous know it all, who values theory well above practice, and struggles to adapt to a real world environment.
Depending on where you did your many courses that may also be a red flag to employers. There are a number of lower tier universities trying to cash in on the FASEA gift, whose quality of education is quite poor.
I would much prefer to take on a candidate with a Bachelors from a high quality uni and a Grad Dip FP from somewhere practical like Kaplan. Other specialist qualifications are what you do after a PY, when you have the practical foundations to properly benefit from them.
BTW can you please explain what a “CFP(non practicing)” is? It never used to be possible to get CFP without 3 years practical experience.
Maybe read my comment properly I have 6 years experience in financial planning(started as CSO worked my way to Associate), I am wanting to learn from someone who is experienced in the field, if they can make the effort and cost to do this as it is clear none of you are willing to do. I did my bachelor majoring in finance at UWA, masters of financial planning at Kaplan, SMSF specialist advisor at the SMSF association.
Calm your role mate you seem to be very arrogant and pompous, the kids only asking for advice on how to get in. Instead of insulting him and taking cheap shots how about giving some helpful tips, your not promoting our industry with that bad attitude
Here is a great way to get more advisers;
Stop treating advisers like criminals
Remove massive red tape
Disband LIF
Remove fees that we are paying for no service for levies and CSLR
Come up with a set of workable, common sense rules that are clear and easy to follow
Stop trying to call product sales people “qualified advisers”
Too much common sense mate.
Migration!!! What about the 200,000 plus accountants that are well qualified with years of experience to provide independent low-cost personal financial advice, that are shut out by ASIC from applying for an AFSL license UNLESS THEY HAVE 3 YEARS EXEPRIENCE UNDER AN EXISITNG AFSL LICENCEE. Surely, they must be a pathway for suitably qualified accountants to have their experience recognized by ASIC.
Accountants have sucked the life out of the Financial Planning industry already, once very different lines of business now charge the same and deliver on average the same short term, transactional value. Like doing a tax return. Who would want to buy that? Ain’t no Tax Act keeping Financial Planners with legislated repeat business… Need real sales chops.
Ahh yes – the answer to all of Australia’s problems = more migration.
Is the FAAA not satisfied with the hundreds of new members they will have when Uber drivers switch to “qualified adviser”?
The FAAA actively worked to restrict the Experience Pathway, and when they saw that wasn’t going to work, sought to grandfather it.
Thankfully they failed on both fronts.
Both of these positions were “restrictive to supply”, or in English, designed to eject existing, experienced, advisers out of their profession.
They were “profession shrinking” positions.
Why?
So that they could keep a small, loud, and aggrieved minority of their membership happy.
“I’ve done my degree, so should they…”
“I followed your rules, so should they…”
Listening to them now talking about a “Migration Pathway” makes my stomach turn.
aren’t we already doing that with the backpackers than man the super fund call centres?
The removal of red tape is a valid pathway to ensure more people receive advice at a lower cost.
It isn’t happening.
Migration ? Twilight zone stuff.