‘Adviser McAdviserface’: Jones not looking to surveys for ‘qualified adviser’ replacement

Financial Advice Association Australia (FAAA) CEO Sarah Abood said Stephen Jones elucidated that a new title to replace the controversial “qualified adviser” would be determined after gathering suggestions from several parties, including the FAAA.

“Minister Jones made a comment that he didn’t want it to be Adviser McAdviserface,” Abood mused ahead of her session at the Adviser Innovation Summit 2024 this week.

“He was referring to the notorious survey to name a Sydney ferry Ferry McFerryface many years ago. I took that to mean that the new term wasn’t going to be decided by a vote or survey. I can confirm that it’s not going to be called conflicted salesperson, which was one of the perhaps tongue-in-cheek suggestions from the adviser community.”

The new term must clearly signal to the consumer that the advice they would receive from the new class of advisers would be different to the holistic personal advice they receive from a financial adviser, Abood stressed.

The FAAA has suggested “restricted adviser” or “limited adviser” as alternatives to qualified adviser, she added.

“This could prompt a conversation with a client about how this adviser is limited or restricted in the advice they provide,” Abood said.

She noted that there is precedent for the term restricted adviser in the UK, who can only recommend products from certain providers or a single company.

“Another school of thought is if the adviser is employed by a financial institution, they could have the institution’s name in the title, followed by adviser,” Abood said.

“This could clearly indicate to the consumer that the adviser can only talk about the products of their parent company.”

On the other hand, some advisers have opposed including the term adviser in the title altogether, and instead suggested using agent, associate, or something similar.

“I think it’s heartening that the minister has said clearly that he is open to and intends to change the name. We hope to see an outcome when the draft legislation for the second tranche is released.”

The government has indicated that the second tranche of the Delivering Better Financial Outcomes package is expected to be released mid-year, although a date has not been specified.

Abood said FAAA is also focused on the scope of the new class of adviser, and while the Quality of Advice Review (QAR) suggested that they would provide simple advice, the definition of simple advice is broad.

“We’ve been looking at various ways that the scope of these new classes of adviser could be defined, because we think it’s important that there is a clear line between what they can do and what a fully qualified professional adviser does,” Abood said.

She also flagged that with the federal election looming in 2025 and the caretaker period that comes into effect once it is announced, she would prefer that the legislation passes under the current government as quickly as possible.

“There’s so much work being done with the current team,” Abood said.

“We’d be concerned that we might lose momentum if that package doesn’t get through the current Parliament. We would like to see the package passed so we can get on with fixing the many issues that the Quality of Advice Review identified. Our hope is that the draft legislation has the elements in it that were suggested in terms of protections and that we can get it through in a short timeframe.”

At the Adviser Innovation Summit, Sarah Abood and FAAA general manager Philip Anderson will discuss the QAR proposals and what it could mean for the future of financial advice if implemented.

It will be held on Tuesday, 4 June at Telstra Customer Insights Centre Sydney, and Thursday, 6 June at Zinc at Fed Square, Melbourne.

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For more information, including agenda and speakers, click here.