- Compulsory education requirements for both new and existing financial advisers;
- Supervision requirements for new advisers;
- A code of ethics for the industry;
- An exam that will represent a common benchmark across the industry; and
- An ongoing professional development component.
The Deputy Prime Minister and Member for New England, Barnaby Joyce has welcomed the introduction of legislation into Parliament that mandates professional standards for financial advisers.
Mr Joyce said the Coalition Government is committed to ensuring that consumers are able to have confidence that if they seek financial advice, they are getting it from a financial adviser who is professionally competent.
“The Turnbull-Joyce Government will continue to take action to ensure Australians can participate in the financial system, with confidence,” he said.
The Minister for Revenue and Financial Services, Kelly O’Dwyer MP, said the new professional standards regime will begin on 1 January 2019. From this date, new advisers entering the industry will be required to hold a relevant degree. Existing financial advisers will have access to transitional arrangements, allowing them two years, until 1 January 2021, to pass the exam, and five years, until 1 January 2024, to meet the education requirements.
“The transition period recognises that existing advisers may need to complete the education requirements on a part-time basis, while continuing to service their existing clients,” Minister O’Dwyer said.
She said the government will establish an independent standards body to administer the regime.
The body will be responsible for developing and setting the industry exam, developing the code of ethics, and setting the education requirements, including working with education providers to establish appropriate courses.
The body will develop the exam, the Code, and the standards in accordance with international best practice and will consult broadly with stakeholders throughout this process. The body will be funded by the industry.
“As a result of the Turnbull Government’s reforms, Australians will have access to financial advisers who will put their interests first, and who are professionally competent and ethical,” Minister O’Dwyer said.
The Corporations Amendment (Professional Standards of Financial Advisers) Bill 2016 includes:
• Compulsory education requirements for both new and existing financial advisers;
• Supervision requirements for new advisers;
• A code of ethics for the industry;
• An exam that will represent a common benchmark across the industry; and
• An ongoing professional development component.