Treasury's proposal adds flexibility for new advisers: FAAA

The Financial Advice Association Australia (FAAA) supports Treasury's proposed education reforms for financial advisers, noting they will provide significant flexibility for new entrants without reducing the rigour of the current settings.

With only 464 new advisers first providing advice in 2025, the FAAA said the current flow of new entrants is insufficient and inadequate, stating that improved access to financial advice is in the best interests of all Australians.

Currently, the FAAA noted, there are too many constraints and hurdles for the industry to grow, including the lack of approved degrees, the need to complete a professional year and 40 hours of ongoing continuous professional development each year are putting those intending to enter the industry on the backfoot.

Contributing to the consultation, the FAAA supports key elements of the proposal around education requirements and the prerequisites to becoming a financial adviser.

"The FAAA recognises that the transition from the current standard to the new standard will take time. It is particularly important that during this transition, and beyond, the knowledge and expertise of the higher education providers (HEPs) who have invested in the development of financial advice education courses is retained," the submission read.

"Our key point is to ensure that to the fullest extent possible, the existing approved programs remain valid and that any additional investment required by these changes is kept to a minimal level for HEPs who are already supporting financial advice education."

However, the FAAA has also made several recommendations, including clarifying the proposed reform will have "no impact" on existing providers who have already met the education standard.

It also wants better support for existing financial advice education providers, and guidance for licensees.

"We strongly support the proposal and urge the government to progress with these reforms as soon as possible. This will make a meaningful difference in enabling more high-quality graduates to enter the financial advice profession," the FAAA said.

"Whilst we believe that this will make a meaningful difference in providing more flexible pathways for new entrants to join the financial advice profession, it is also essential that the government is careful with the introduction of other reforms that could act as a disincentive for potential new entrants, including through the imposition of further levy increases or other limitations on the provision of financial advice."

Access to ATO Portal

Meanwhile, a submission as part of the Joint Associations Working Group (JAWG) reiterated the substantial client and business benefits in enabling financial adviser access to the ATO Portal.

Both parties believe the ability to access client's financial, tax, social security, and family information can only improve and enhance the quality of advice.

"Understanding taxable income and the sources of that income is critically important," the submission stated.

"Superannuation is typically the largest financial asset people have, so understanding what accounts they have, how much they have and what contributions have previously been made is essential.

"Obtaining this information can be particularly challenging for clients and advisers, resulting in a material cost to each."

Additionally, the current method to obtain this information via email can result in a "significant risk or cyber threat" as well as prolonged administrative burden between advisers and super funds.

"Financial advisers are recognised in the law as providers of taxation advice (Qualified Tax Relevant Providers) and therefore it is appropriate that they have access to client tax and superannuation data to assist in the provision of this tax advice," it said.

"The risks with respect to this issue [cyber threat and costs] are no greater for financial advisers than for tax agents and BAS agents. Financial advisers should be able to meet the information technology and client identification requirements that the ATO requires tax practitioners to uphold and these are accepted as preconditions for financial adviser access."