Australia: Financial Planning Association calls for simplification of advice

| 31 May 2022

The regulatory environment needs to allow advisers to use their professional judgement and give simple advice without fear of falling foul of the law, according to Financial Planning Association of Australia (FPA) chair David Sharpe.

Sharpe said he wanted to bring about practical changes for advisers which would help them day-to-day. Perth-based Sharpe, who had run his own practice since 2009, took over as chair from Marisa Broome earlier this month.

“Part of why I got involved with the FPA is that I’m a practitioner, and I want to make sure that is appropriately represented and give the members confidence that there is a practitioner who cares and feels the same way about issues and regulation as they do.”

As an adviser, Sharpe said his biggest challenge was being unable to help consumers with simple questions. He hoped the regulator in the future would allow advisers to use their own experience and professional judgement as to the amount of advice and work a client would require. 

“[The biggest challenge] is when you have a client with a really simple need and you sigh because you know exactly what you could tell them really quickly, but you know it would be a lot of work and you’d have to write a Statement of Advice. That is ridiculous, this is not great for consumers, and it frustrates me that I can’t give them the information they need in a two-minute phone call. 

“As an adviser, you live in fear of ‘I’ve got to go through everything’. We need a scenario where someone can come in for simple advice, have a 30-minute meeting, receive the advice that’s important to them and leave. We don’t have a regulatory framework that allows for that and that’s what we need to solve.” 

As a result, he said his two goals as chair were around advocacy and simplification. 

“There needs to be simplification and a respect of the changes that are happening in financial planning in terms of professionalisation and education. 

“I don’t mean trimming round the edges, I mean repealing some legislation, we’ve had band aid after band aid put on until we’ve got to a point where an adviser can no longer give simple advice.” 

However, despite the challenges, he still said being a financial adviser was his “dream job” and he hoped to be able to continue in the role. 

“I sort of fell into a role that was financial planning and absolutely loved it and, barring someone saying I could travel the world and commentate on cricket, this is my dream job.

“There is all this frustration but then you have your client meetings and see the change that happens in their world because of how you’ve helped them. And that makes it worth it. That's the fundamental reason why most of us still get out of bed and drag ourselves through this compliance regime to make that difference for our clients,” he said, according to Money Management.