FPA ADVOCACY: HOW TO ENGAGE YOUR LOCAL MP · There are many ways you can engage with your local MP, such as writing a letter, phoning, emailing and following them on social media

FPA ADVOCACY:

HOW TO ENGAGE YOUR LOCAL MP

June 2016

INTRODUCTION

Engaging with your local Member of Parliament (MP) is an effective way of demonstrating that

you care about the laws that govern both your profession and the financial affairs of all

Australians.

Your local member has the responsibility of representing the views of their electorate in

Parliament and in party room discussions, so it’s important you make those views known. Part of

their job is to have meetings with groups and individuals about a range of issues and concerns

so they can develop informed positions that represent their electorate.

However, engaging with your MP takes time and effort for both you and your local Member. So

we have developed some practical tips and tools on the most effective ways to engage with your

MP to help you make the most of the opportunity.


There are many ways you can engage with your local MP, such as writing a letter, phoning,

emailing and following them on social media. But by far the most effective form of engagement

with your MP is a face-to-face meeting.

The following fact sheets provide tips on how to engage your local MP.

1. Important tips to get you started

2. Finding and addressing your MP

3. Tips for writing a letter to your MP

4. Tips for writing an email to your MP

5. Making the most of your face to face meeting

6. Tips for telephone calls with your MP

7. Engaging with your MP via social media

8. What to give your MP

Let us know about it!

If you meet with an MP, we would appreciate your feedback on how the meeting went and what

outcomes you were able to achieve. Please let the FPA know – email us at [email protected]

For further information or assistance, and to report back on your meeting, please do not hesitate

to contact us on (02) 9220 4500 or [email protected]

mailto:[email protected]

mailto:[email protected]


Important tips to get you started

Personalise your issue ̵̵ Tell your story

While an issue you are discussing may affect the whole profession, and the MP action you are

asking for may be endorsed by the FPA, personalising the issue will help get your message

across. Explain how it affects you, as a financial planner and personally, your business and your

clients.

Take the time to personalise your issue by adding your own thoughts, or putting the points in

your own words. Consider the following:

Include a personal experience that made you want to speak up on the issue

Detail the impact the issue has on your clients – use case studies to show how the

issue will impact client circumstances, needs, and financial security

Describe the impact the issue has on your business and the services you provide your

clients

Do your sums to demonstrate potential costs for your business

If the issue would result in a reduction in client services or hours helping clients, work

out how many hours and explain why

If the issue impacts the growth or sustainability of your business, demonstrate how.

Using your own words, explain why / how Australians will benefit from your MP

supporting your position on your issue.

Do your homework ̵̵ Research your MP

The more knowledge you have about your local MP the greater your opportunity to influence

them. Spend some time doing background research.

Biography - The Senators and Members section of the Parliament House website

contains their biography, first speech, which Parliamentary Committees they may

participate in, and their political party.

MP’s ̵̵position ̵̵- If your MP has participated in a House Committee or a Joint or Senate

Committee related to your issue or financial services, check the Committee transcript

for any comments they may have made that may indicate their position on your issue.

All sessions of Parliament are recorded and documented in the Hansard transcript. If

you have time, a quick search of Hansard for any relevant views your local MP may

have expressed can also be worthwhile.

Party position - If your issue has been the subject of a Parliamentary Inquiry, check

the Committee Inquiry Report and public hearing transcripts to find out the position of

your local MP’s political party.

http://www.aph.gov.au/Senators_and_Members

http://www.aph.gov.au/Parliamentary_Business/Committees/House

http://www.aph.gov.au/Parliamentary_Business/Committees/Senate

http://www.aph.gov.au/Parliamentary_Business/Committees/Senate

http://www.aph.gov.au/Parliamentary_Business/Hansard

Personal website - Check their personal websites to find out which issues they have

previously taken up and feel particularly passionate about. Have a look for statements

related to your issue or financial services more generally.

Make an appointment

If you plan to visit your MP, or would like to speak to them on the phone, call the MP’s

electorate office to set up an appointment. Don’t just show up and expect to be seen.

Electorate office details can be found on the Senators and Members section of

www.aph.gov.au.

Check when Parliament is sitting in Canberra. Ask for an appointment when Parliament is not

sitting so you can meet your MP in their electorate office.

When asking for an appointment, you should explain:

who you are and that you live or work in the MP’s electorate;

when and why you would like to meet with or speak to the MP (what your issue is);

who will be coming to the meeting (if you are attending with fellow financial planners or

clients for example); and

what you hope to achieve.

Be prepared and organised

Spend some time preparing what you would like to discuss with your MP.

• Consider an agenda - You should make a list of the items you would like to cover. You may choose to make an agenda you share with your MP so they are aware of the items you wish to cover.

• Make your key points clear - Meeting times with MPs are usually short so it is best to limit your discussion to key points that demonstrate your concerns about the issue –

don’t try to cover too much in one meeting.

• Delegate - If you’re meeting with an MP as a group, decide ahead of time who will lead the meeting, who will cover which points, who will speak when and for how long. A maximum of 2-5 people is preferred in a group meeting.

• Engage with your MP - Ask your MP what they think about the issue.

• Have ̵̵a ̵̵clear ̵̵‘call ̵̵to ̵̵action’ ̵̵- Work out beforehand what you will be asking your MP to do.

http://www.aph.gov.au/Senators_and_Members

http://www.aph.gov.au/

http://www.aph.gov.au/About_Parliament/Sitting_Calendar

Be clear about what you would like your MP do to - your ̵̵“call ̵̵to ̵̵action”

The point of engaging with your MP is to ask them to do something about the issue you are

raising. What is it you want your MP to do? Don’t be afraid to ask – acting on behalf of his/her

constituents is a normal part of a politician’s life. Make your pitch clear, concise and compelling.

For example, would you like your MP to:

support or oppose a Bill before Parliament

call for amendments to a piece of new legislation

reflect your views to leaders within their party

endorse a particular position on an issue or campaign

pass on your concerns to the responsible Minister

pass on your concerns to a Government agency to help resolve your issue, or

raise your issue in a speech to Parliament.

Work out beforehand what you will be asking your MP to do and plan to finish your visit, phone

call or letter by informing the MP how you would like to follow up on the issue with them.

Remember your manners

Be polite – While it is important to make your position firm and clear, always be

courteous. Knowing your Member’s (and their party’s) views beforehand, will help you

prepare and work out how to manage your discussion with your MP, especially if your

Member or their party holds a different view to yours.

Keep the irritation factor low - Threats, hostile remarks and rude/offensive language

are among the fastest ways to alienate people who could otherwise decide to support

your position in light of rational and reasoned argument. Your MP could be your local

Member for decades, and could be promoted to higher, more influential positions within

their party. Avoid creating enemies.

Get to know your MP – If you were not able to identify a clear position your MP holds

on your issue through your background research, ask them what they think. They may

hold a slightly different view to their party colleagues so it is important you don’t just

assume their position. However, be accepting if they seem reluctant to disclose their

views or the position of their political party, just inform them of your views and why they

should support your position.

Engage with supporting and opposing MPs – Don’t limit your engagement with your

local MP to criticisms of their opposing views. If you know your local MP supports your

position, it is still beneficial to contact them. Take the opportunity to thank them for their

support and provide them with your personalised concerns about your issue. Write

thank you letters to politicians/parties that you know support your position. This will

provide them with further evidence that constituents support their position and

encourage them to stand firm on their position rather than backing down. This will also

benefit your long-term relationship with your MP – it will ensure your engagement with

them is not always based on criticisms.

Personalise your relationship - If you have ever voted for your MP, or contributed

time or money to their election campaign, or have met them previously, say so. The

closer your MP feels to you, the more effective your communication with them is likely

to be.


Finding and addressing your MP

Find the electorate you are in

If you are not familiar with the name of your electorate, conduct a search using the Australian

Electoral Office find an electorate search tool.

Find contact details of your local MP

The Members section of www.aph.gov.au provides contact details and background information

on your local MP.

How do I address a Member of Parliament?

You may also find the following guide helpful in ensuring you address any correspondence with

your local MP appropriately - How do I address a Member of Parliament?

http://apps.aec.gov.au/esearch/

http://www.aph.gov.au/Senators_and_Members/Members

http://www.aph.gov.au/

http://www.aph.gov.au/Senators_and_Members/Guidelines_for_Contacting_Senators_and_Members/How_to_address_Senators_and_Members


Writing a letter to your MP

A handwritten, or typed and signed letter, is the most effective means of communication (other

than a face to face meeting). It is far more effective than photocopied form letters, postcard

campaigns or emails. Writing to your MP is a good way of letting them know what issues are

concerning people in their electorate.

• Include your name and address - Identify yourself as a constituent by including your address when you write to your MP. Generally, politicians are likely to pay most attention

to people who live or work in their electorate.

• Keep it brief - Letters should be no longer than one page. Be as concise as possible. Politicians receive many letters on many topics every day. Long letters are likely to be put aside to read on a less busy day and that day may never come.

• Personalise your letter - When possible, include a personal story and/or information on

how the issue affects you, your family, your business, or your clients. This can help your

MP understand your position and can be very persuasive as they consider an issue. The

more personal your letter, the more impact it is likely to have.

• Use your own words - Even if your writing skills are not the best, a letter written in your own words will carry much more weight than regurgitating what some else said. However, this does not mean that many individuals cannot meet with their MP on the same issue and ask for the same political action from their MP. Use your own words based on the impact the issue has on your own situation. If you use a ‘call to action’ or issue recommendation provided by us, you can acknowledge that it is an FPA endorsed plan when you meet with your MP. But it is important to also put in your own words why this issue and plan of political action is important to you and your clients as members of your MP's constituency. Tell them why you support FPA’s position based on your own situation.

• Handwrite, or type and sign, your letter - A handwritten, or typed and signed, letter is far more effective than photocopied form letters, postcard campaigns or emails.

• State the topic clearly - Include a subject line at the beginning of your letter. If it is about a specific piece of legislation (an Act) or a proposed law (a Bill), state the full name of the Act or Bill in the subject line.

• Start with a clear statement of purpose - For example: "I am writing to urge your support for / opposition to..." "I am writing to ask you to support / oppose ..."I am writing to ask you to call for…”

• Focus on your key points - Choose the three points that are most likely to be persuasive in gaining support for your position and flesh them out. This is more effective than attempting to address numerous points in a letter. Make sure your points focus on the impact the issue will have on you, your business and your clients. Do not complain or criticise.

Ask your MP to take concrete action - For example, in relation to a proposed law (a

Bill), ask them to raise the matter in their party room and seek to have their party

oppose the Bill. Point out that the issues are important enough to warrant amendments

to the Bill, and/or for your MP to cross the floor and vote against the Bill if their party

supports it.

Use simple language - Be concise and keep your letter to a single page. Feel free to

provide facts and figures where relevant, but make sure you keep your letter

conversational so that your MP understands it’s coming from a real person.

Personalise – Use personal examples to illustrate how your issue affects you, your

business, family and clients.

Request a meeting – Offer to meet with your MP in their electorate office to discuss the

issue and its impact on you and your clients, in more detail. Consider calling your MP’s

electorate office the following week to confirm your letter was received and seek a

convenient meeting time.

Ask for a response to your letter – Even if the response is a form letter, written and

authorised by their political party, your letter will have had an impact on your MP’s

office. A well-written letter can be instrumental in prompting your MP to take action

behind the public scenes to inform and potentially change their political party's position.


Writing an email to your MP

Most of the tips for writing letters also apply to writing emails to your MP. The following tips will

help maximise the probability of your email being read and considered:

Write to appropriate politicians, not everyone - Send your email to your local MP,

not to everyone. Mass emailing politicians may be viewed as hostile and can overload

mail servers and be blocked like spam or make it difficult for politicians and their staff to

cope. Thoughtful and appropriately directed email is more likely to be read and

considered.

Include your name and address - Email can come from anywhere in the world so be

sure to identify yourself as a constituent by including your address at the top of your

email. Politicians are most likely to pay attention to people who live or work in their

electorate. You may receive a computer generated acknowledgement, but it may take

your MP’s office some time to respond more specifically to your email.

Use the formality of a letter, not the informality typical of emails - The formality of a

letter makes a better impression on most politicians than the informal style often used in

email messages. Pay attention to spelling (and auto-spell check), punctuation,

capitalisation, and grammar. Address your MP appropriately and commence with "Dear

...".

Use the "To" field - Place the politician's email address in the "To" field of your email,

not in the "copy" (c.c.) or "blind copy" (b.c.c.) fields, to minimise the risk of your email

being treated like spam and automatically deleted or sent to a junk mail folder.

Clearly state your topic in the subject line of your email


Making the most of your face to face meeting

Face to face meetings with your MP and/or a relevant member of their staff are the most

effective. A meeting usually needs to be arranged at least a week (and often more) in advance,

and may be particularly difficult to organise for a day during weeks when Parliament is sitting.

Normally, a 15-30 minute time slot will be set aside for your meeting. Although do keep in mind

an MP may be late, have to cut a meeting short, arrive halfway through or need to cancel

unexpectedly sometimes through no fault of their own. Be understanding and flexible.

The MP will usually be accompanied by a staff member.

A meeting is usually divided into four segments:

1. Welcome and introductions

2. Making your case

3. Discussion

4. Wrapping up

Keep these important tips in mind:

Addressing your MP - Use an MP’s correct title (Senator, Minister or Mr/Mrs) and

surname (for example, Mr/Mrs Smith or Senator Smith) unless you’re invited to use his

or her first name.

MP’s staff are just as important - If you’re invited to meet with other staff members,

don’t underestimate their importance or influence; treat those meetings as if they were

with the MP.

Have a clear purpose - Remember to be clear and concise with what you want and

why you are there.

Group dynamics - If you are in a group, be careful not to contradict each other, talk

over the top of your MP or each other, or repeat each other. Be organised – decide

beforehand who in the group will talk on what points. Each group member should

personalise the issue.

Time is limited - It’s good to be passionate about your cause, but don’t get too caught

up in discussing your issue as you only have a short time to speak.

Personalise - Speak in your own words so your member knows that they are dealing

with a real person – use personal stories.

Don’t assume knowledge - Don’t assume the MP knows anything about your issue.

You might find you know more about a particular issue than he/she does. MPs have a

wide range of issues to investigate as part of their job and can’t be experts in all of

them.

http://www.aph.gov.au/About_Parliament/Sitting_Calendar

Use plain language - Speak at a basic level and avoid using industry jargon, acronyms

and abbreviations (for example, SOAs, MDAs, MIS, FOS, etc).

Follow cues - Be quick to jump ahead if you’re told, or if you can see that the MP is

familiar with the issue.

Engage with your MP – Don’t do all the talking. Don’t forget to engage with your MP

too and ask what they think about the issue.

Stay on-topic - If your MP seems to be getting off-topic, gently try to bring them back to

it.

Tough issues - Be respectful, but firm. Don’t be intimidated or afraid to bring up tough

issues.

Be polite - Question an MP on past votes or positions taken or ask for a definitive

answer. Remember though that professionalism and a sense of committed

determination will go further than name-calling or attacks. Never be rude.

Be honest - If you don’t know the answer, just say so. You don’t need to be an expert.

It’s enough to say who you are and why you care about an issue. Be as responsive as

you can be but don’t make things up. You can always get back to them with an answer

after the meeting.

A clear ‘call to action’ - Make sure you let your MP know what you would like to come

of your meeting and what you action you would like your MP to take.

Thank you - At the end of the meeting, thank the MP for their time, even if they don’t

agree with your position. Remember that you are aiming to build a relationship with

them.

Briefing notes - Leave your MP with a set of briefing notes outlining the key points of

your issue and the action you are requesting. One or two pages is best.

Follow up - Make sure you also send a follow-up email or letter in the week following

your meeting, thanking the MP for their time, and reminding them about your requested

‘call to action’.


Telephone calls with your MP

If you can’t arrange a face to face meeting, or would prefer to talk to your MP on the phone,

then arranging time for a phone conversation is also a way to engage with MPs.

Prepare for this conversation in the same way you would for a meeting – by researching the

MP, putting together an agenda of points and by making an appointment. Be clear about your

purpose for the phone call, explain yourself clearly and ask for the MP to commit to an action at

the end of your call.

Know your topic - Before phoning about a proposed law, be sure you know the full

name of the Bill.

Limited time - Be prepared to express your comments briefly and concisely.

Identify yourself - When you call, give your name and also identify yourself as a

constituent when phoning a member of parliament who represents you.

MPs’ staff are just as important - You may be put through to a staff member. Do not

underestimate their importance or influence; treat your phone conversation as if the

staff member were your MP.

Clearly state your issue - Ask to speak to your representative or their relevant adviser

about the [name of Bill, or topic].

A clear call for action - Ask that your MP take concrete action, such as supporting or

opposing a Bill, or seeking to have their party take a certain position on an issue, etc.

Be polite and professional

Follow up - Follow up your telephone call with a letter or email. Thank the MP or their

staff member for their time, remind them of the key points raised in your discussion

and the call for action you requested your MP take on your issue.

HOW TO ENGAGE WITH YOUR LOCAL MP

Using social media to engage with your MP

In an age where some politicians ask their Twitter followers their views on policy issues and

MPs’ social media posts make the news, it is clear social media plays a role, not only in our

personal and professional lives, but shapes how we participate in politics and politicians engage

with their constituents.

Social media is a two-way communication tool. Therefore, you have to treat it like an on-going

conversation that you’re having with your MP and others.

Posting a comment to their page or feed can be a good way of starting a conversation with

them, or at least showing them – and readers of their site – what people are thinking about.

There are hundreds of social media platforms however those most commonly used by MPs

include:

Twitter - Twitter enables you to post quick, frequent messages which may contain

photos, videos, links and up to 140 characters of text.

Facebook - People use Facebook to keep in touch with friends, post photos, share links

and exchange other information. Facebook users can see only the profiles of confirmed

friends and the people in their networks.

YouTube - YouTube is a global video-sharing website.

LinkedIn – LinkedIn is designed specifically for the business community. The goal of the

site is to allow registered members to establish and document networks of people they

know and trust professionally.

Social media allows you to connect with your MP in a short, informal way. It is quick, timely and

alerts your MP to issues immediately.

However, there are some key points to remember when engaging with your local MP via social

media:

Focus on your relationship with your MP - Remember your social media post can

make or break your relationship with your local MP and their views of the financial

planning profession.

Confidentiality – Social media inherently blurs the line between public and private.

Remember many of the posts you make to politicians on social media can be accessed

and read by anyone – family, friends, clients and colleagues included.

Think before you post! - Before you post a comment, think carefully about what you

say and how others may react to your post.

Protect your important relationships - For the important relationships in your life

such as clients, work colleagues, good friends and family, keeping contentious political

discussion off line might be best.

• Is social media really ‘you’? - Decide ahead of time if social media is the right place for you to engage with your MP or to comment on politically sensitive issues.

• Select your social media platform - Carefully select which platform is best suited for how you want to talk about your issue and engage with your local MP. For some, Facebook is seen as a place to keep in touch with family and friends and therefore limit their political engagement on this social network. You may find Twitter is a better place to more freely discuss or comment on issues.

• Keep it short with a clear call to action - Remember social media is a short form of communication, so keep to your key point and call on your MP to take action on your issue.

• Stick to facts - Sharing information that is evidence-based, neutral in tone, compelling and accurate, is the best way to engage in debate on your issue via social media. The minute a social media post becomes contentious, editorialised, or based on opinion, the less credibility people will give it. Stick to facts and avoid getting emotional. Say it with strength and accuracy, clearly and well written.

• Ask questions to start conversations - Asking a good, thoughtful question on your issue is a good way of starting a social media engagement with your MP.

• Keep it personable – talk like a real person.

• Be professional – Be civil, polite and respectful. When making comments about a policy issue, always be professional; avoid personal comments; and never criticise others, especially other financial planners. Be careful what you say about others.

• Re-tweeting and ‘liking’ – Re-tweeting or ‘liking’ a comment on social media is providing an endorsement of those comments and therefore it can reflect positively or negatively on you. When engaging with your MP via social media it is important to never

endorse (ie. re-tweet or ‘like’) ranting, rambling, melodramatic, emotive, critical or

personal messages that others may post.

• Avoid highly negative/critical comments – Avoid using overly negative comments on social media, even those comments you think might help counter opposing views on your issue. You just can never tell how others may react and a highly negative / critical post could work against you. That grey area between public and private that social media inhabits can make it difficult to navigate what’s “right” to post and what should remain offline. Remember your work colleagues and clients could take offense to negative comments, as could your MP.

• Avoid the heat of the moment – Emotional knee-jerk comments should be avoided. They can harm your relationship with your MP and others.

• Maintain your impartiality – Stick to the facts and avoid politicising your issue. Maintain political impartiality.

• Keep in contact - Invite your MP to follow FPA/you on Twitter or like your Facebook /

LinkedIn page, or FPA’s Facebook / LinkedIn page.


What to give your MP

When engaging with your MP a personal representation can be more effective than one that is

mass produced. However, this does not mean that many individuals cannot meet with their MP

on the same issue and ask for the same political action from their MP.

We have developed a one page plan of the actions needed to continue the journey towards

financial planning being recognised as a profession. We have also developed a series of fact

sheets on the key issues currently facing the financial planning profession and their clients.

You can acknowledge the fact that this is an FPA endorsed plan when you meet with your MP.

But it is important to also personalise why this plan of political action is important to you and

your clients as members of your MP's constituency.

1. One page plan

2. Transition to Retirement (responding to 2016 Budget super changes)

3. Royal Commission

4. Financial planner Professional Standards and Education requirements

5. Industry funding model for ASIC

6. Tax deductibility of advice fees

7. Implementation of FSI recommendation

8. What is financial planning?

9. Who is the FPA?

For further information - Dimitri Diamantes, Policy Manager, Financial Planning Association 02 9220 4500, [email protected]

THE FUTURE FINANCIAL PLANNING PROFESSION

Building an effective regulatory regime for planners and consumers

1. Support the implementation of the financial advice Professional Standards and Education

proposals to improve consumer protection. Support:

a. a minimum education criteria of degree equivalent or higher

b. monitoring adherence to a code of ethics

c. standardising continuing professional development (CPD)

d. developing an exam for financial advice providers

e. supervision requirements for new financial advisers, and

f. restricting the term financial planner/adviser in the Corporations Act.

2. Support the implementation of the Financial System Inquiry recommendations to

strengthen product regulation (recommendation 21 and 23), enhance ASIC powers

(recommendation 22 and 29), and rename ‘general advice’ (recommendation 40), to

improve consumer protection.

3. Call for an industry funding model for ASIC that:

a. appropriately reflects ASIC’s activity necessary to oversee the risk posed toconsumers based on the scale of the advice operations and other risk factors.

b. is scalable based on the size of the business so it complies with government policyregarding small business

c. aligns with the recommendations of the Financial System Inquiry, PJC Inquiry, andASIC Capability Review, and

d. is delayed by at least 12 months due to the uncertainty of the implementation ofthe PJC and FSI recommendations

4. Call for government consultation to determine the consumer and economic benefits of

having the preparation of an initial financial plan and ongoing management fees, or annual

retainer fees, be expressly stated in the law to be tax deductible.

5. Call for the 2016 Federal Budget changes to the tax exemption status of transition-to-

retirement (TTR) pensions and the reduction in the Concessional Contributions cap to be

restricted to each individual whose total superannuation balance has reached the transfer

balance cap.

6. Call for a review into the effectiveness and value of the retail, sophisticated, and wholesale

investor definitions in the Corporations Act.

7. Oppose the inclusion of financial planning / advice in a Royal Commission to allow for the

current reforms to be fully implemented and their effectiveness measured. The financial

planning profession has been subject to 54 inquiries, reviews and consultations since 2009

leading to the introduction of 5 new major legislative regimes and increased regulation to

address industry issues and provide better consumer protections. A Royal Commission will

stall the implementation of the current reform process and put consumers at greater risk

for longer.

ACHIEVING A COMFORTABLE RETIREMENT

Encouraging self-funded retirement

POLITICAL ACTION REQUIRED

Oppose the following changes to the superannuation system announced in the 2016 Federal

Budget as they discourage saving for retirement:

Lowering of the concessional contributions cap to $25,000

Removal of the tax exemption for earnings on assets supporting ‘transition to retirement’

income streams, and the abolition of the anti-detriment payment.

counting non-concessional contributions (NCCs) made before Budget night 2016,

towards the proposed lifetime NCC cap.

WHY?

More people will need to rely more heavily on the Age Pension.

It will be even harder for people to achieve a comfortable standard of living in retirement.

It is unfair to change, to the detriment of an individual, the way contributions already made

are treated.

WHO IS HURT BY THE REMOVAL OF TTR MEASURES

Middle income earners will be significantly more impacted than others by the TTR changes

which will reduce the ability of middle income earners to boost their retirement savings

Less impact on low income earners as they will be assisted by the introduction of the Low

Income Superannuation Tax Offset and age pension changes.

High incomes earners will be much less effected:

o The tax benefits of TTR strategies are limited by the concessional contributions cap

(CCC)

o High income earners typically use up more of their CCC cap with their

Superannuation Guarantee contributions

Income Starting balance

at age 56

Balance at

retirement (age

65) - Current

rules; no TTR

Balance at

retirement (age

65) - Current

rules with TTR

Balance at

retirement (age

65) - Proposed

rules

Percentage loss

from change in

rules

$37,000 $75,000 $148,186 $159,605 $157,367 1.40%

$87,000 $200,000 $382,914 $422,369 $415,365 1.66%

$120,000 $280,000 $534,190 $579,256 $557,050 3.83%

$180,000 $500,000 $917,919 $957,958 $930,707 2.84%

$500,000 $1,750,000 $2,743,360 $2,791,403 $2,745,252 1.65%


WHAT IS A TRANSITION-TO-RETIREMENT (TTR) STRATEGY?

In 2005 the Government introduced a set of tax reduction measures to help Australians who

wanted to transition to retirement (TTR) via part-time work.

The aim was to encourage people who were nearing retirement to implement a TTR

strategy to increase their savings for a self-funded retirement and reduce the pressure on

the age pension.

A transition-to-retirement pension allows people (who have reached their preservation age)

to draw down a pension from their super while continuing to work and continuing to make

superannuation contributions – increasing their funds for retirement.

SOLUTION

The changes to the tax exemption status of transition-to-retirement (TTR) pensions, and the

reduction in the concessional contributions cap should kick in when the individual’s total

superannuation balance has reached the transfer balance cap (of $1.6 million as proposed in the

2016 Budget).

For example, where an individual’s total superannuation balance for an income year exceeds the

transfer balance cap:

and the individual exceeds the proposed, lower concessional contributions cap in that

income year – the excess would be included in their personal income;

and the individual holds a TTR income stream in that income year – the notional

earnings on the income stream balance would be subject to 15% tax and have to be

paid directly to the ATO out of a nominated superannuation interest of the member.

Further, NCCs made before 1 July 2016 should be grandfathered, ie, not be counted towards

the lifetime NCC cap. This would address the unfairness of the Budget proposal as well as the

practical difficulties of dividing contributions made in the 2015-16 income year into pre- and

post-Budget night contributions.

The financial planning profession has been subject to 56 inquiries, reviews and consultations since 2008

This has led to the introduction of 5 major legislative regimes and increased regulation to address industry issues and provide better consumer protection

Key legislation packages• FOFA (2012 - 2016)

• TASA (2013)

• ASIC register of financial advisers (2015)

• Life Insurance Framework (2016 - currently in the Senate)

• Professional Standards and Education (2016 - in draft)

POLITICAL ACTION REQUIREDOppose the inclusion of financial planning / advice in a Royal Commission to allow for the current reforms to be fully implemented and their effectiveness measured.

WHY?The financial planning profession has been subject to 54 inquiries, reviews and consultations since 2009 leading to the introduction of five new major legislative regimes and increased regulation to address industry issues and provide better customer protections. A Royal Commission will stall the implementation of the current reform process and put consumers at greater risk for longer.

Resulting improvements to the provision of financial advice in Australia:• All financial planners are now subject to a best interest duty and required to place their clients’ interests above their own and those of related parties • Conflicted remuneration on superannuation and investments has been banned• Since the implementation of the ASIC Financial Adviser Register, all licensed financial planners are now listed on a public national register• All financial planners must be personally registered, or supervised by, a registered individual with the Tax Practitioners Board (TPB)• The TPB requires financial planners to abide by a code of ethics, meet higher qualification standards, and undertake continued professional development.

The new Professional Standards and Education requirements for financial advice providers, life insurance framework, and some outstanding FOFA reforms are yet to be finalised and implemented.

Many of these measures are less than three years old and are still in implementation phase. It is important that we allow time for the full impact of these changes to be felt.

© 2016 Financial Planning Association of Australia Limited

ROYAL COMMISSION INTO FINANCIAL SERVICES IN AUSTRALIA

Inquiries, Reviews and Consultations TypeCompleted (year)

Treasury Exposure Draft - Tax Agent Services Bill (2008) Legislation Exposure Draft 2008

Senate Economics Committee Inquiry into the Tax Agent Services Bill 2008 (2009) Inquiry 2009

Parliamentary Joint Committee on Corporations and Financial Services inquiry into financial products and services in Australia (2009) Inquiry 2009

Superannuation System Review (Cooper Review) Panel: Phase 1 - Review into the governance, efficiency, structure and operation of Australia’s superannuation system (2009) Inquiry 2009

Treasury Options paper - regulation of tax agent services provided by financial planners (2010) Consultation 2010

Superannuation System Review (Cooper Review) Panel: Phase 3 - Issues Paper of the Review into the governance, efficiency, structure and operation of Australia’s Superannuation System (Review) (2010) Inquiry 2010

ASIC Report 224 - Access to Financial Advice (2010) Report 2010

Treasury Exposure Draft - Future of Financial Advice Bill 2011: Exposure Draft - Tranche 1 (2011) Legislation Exposure Draft 2011

Treasury Exposure Draft - Future of Financial Advice Bill 2011: Exposure Draft - Tranche 2 (2011) Legislation Exposure Draft 2011

Parliamentary Joint Committee on Corporations and Financial Services Inquiry into Corporations Amendment (Future of Financial Advice) Bill 2011 & Corporations Amendment (Further Future of Financial Advice Measures) Bill 2011 (2011) Inquiry 2011

Treasury Options Paper - Wholesale and Retail Clients (2011) Consultation 2011

Parliamentary Joint Committee on Corporations and Financial Services Inquiry into the collapse of Trio Capital and any other related matters (2011) Inquiry 2011

ASIC Report 251 - Financial advice industry practice (2011) Report 2011

Treasury Statutory Compensation Review (Richard St John Consumer Compensation Review): Consultation Paper Response (2011) Inquiry 2011

Senate Economics Legislation Committee inquiry into Corporations Amendment (Future of Financial Advice) Bill 2011 & Corporations Amendment (Further Future of Financial Advice Measures) Bill 2011 (2012) Inquiry 2012

Treasury Exposure Draft - Corporations Amendment Regulation (No. ) 2012 - Package 1 & 2 (2012) Legislation Exposure Draft 2012

Treasury Exposure Draft - Corporations Amendment Regulation 2012: FOFA Draft Regulations – Package 3 (2012) Legislation Exposure Draft 2012

Reviews and Inquiries into financial advice in Australia since 2008(including implementation of financial advice related legislation)



ASIC Consultation Paper - CP 182 Future of Financial Advice - Best interests duty and related obligations - Update to RG 175 (2012) Consultation 2012

ASIC Consultation Paper - CP 183 Giving information general advice and scaled advice (2012) Consultation 2012

ASIC Consultation Paper - CP 189 Future of Financial Advice - Conflicted remuneration (2012) Consultation 2012

ASIC Consultation Paper - CP 191 Future of Financial Advice - Approval of codes of conduct for exemption from opt in requirement (2012) Consultation 2012

Treasury Statutory Compensation Review (Richard St John Consumer Compensation Review): Review of compensation arrangements for consumers of financial services - Consultation on final report (2012) Inquiry 2012

Treasury Exposure Draft - Accountants’ Exemption Replacement Regulations (2012) Legislation Exposure Draft 2012

ASIC Report 279 – Shadow Shopping of retirement advice (2012) Report 2012

Parliamentary Joint Committee on Corporations and Financial Services inquiry into A regulatory framework for tax (financial) advice services (previously Tax Laws Amendment (2013 Measures No. 2) Bill 2013, Schedules 3 and 4) (2013) Inquiry 2013

Treasury Exposure Draft – Corporations Amendment Regulation 2013 (No. F): Grandfathering (2013) Legislation Exposure Draft 2013

Parliamentary Joint Committee on Corporations and Financial Services Inquiry into Corporations Amendment (Simple Corporate Bonds and Other Measures) Bill 2013 – Schedule 2 (enshrinement of term Financial Planner/Adviser) (2013) Inquiry 2013

Senate Economics References Committee inquiry into The performance of the Australian Securities and Investments Commission (2013) Inquiry 2013

Financial System Inquiry Inquiry 2013

ASIC Report 328 – FOFA conflicted remuneration consolation (2013) Report 2013

ASIC Report 329 – FOFA Code approval consultation (2013) Report 2013

ASIC Report 337 – SMSF Advice (2013) Report 2013

ASIC Report 362 – Financial advice industry practice (2013) Report 2013

ASIC Report 377 – Advice on structured products (2013) Report 2013




ASIC Consultation Paper - CP 212 Licensing: Training of financial product advisers – Updates to RG 146 (2013) Consultation 2013

Treasury Exposure Draft – Tax Agent Services Regulations 2009 (2014) Legislation Exposure Draft 2014

Treasury Exposure Drafts - Corporations Amendment (Streamlining of Future of Financial Advice) Bill 2014 & Corporations Amendment (Streamlining Future of Financial Advice) Regulation 2014 (2014) Legislation Exposure Draft 2014

Senate Economics Legislative Committee inquiry into Corporations Amendment (Streamlining of Future of Financial Advice) Bill 2014 (2014) Inquiry 2014

Financial System Inquiry Submissions (2014) Inquiry 2014

Financial System Inquiry Second Round Submissions (2014) Inquiry 2014

ASIC Report 384 – Regulating Complex Products (2014) Report 2014

ASIC Report 407 – Implementation of FOFA (2014) Report 2014

ASIC Report 413 – retail life insurance advice (2014 Report 2014

Joint Committee on Corporations and Financial Services inquiry into proposals to lift the professional, ethical and education standards in the financial services industry (2014) Inquiry 2014

Senate Economics References Committee inquiry into Forestry managed investment schemes (2014) Inquiry 2014

Treasury Exposure Draft - Corporations Amendment (Register of Relevant Providers) Regulation 2014 (2014) Legislation Exposure Draft 2014

Life Insurance Advice Working Group Inquiry (2014) Inquiry 2014

Treasury Consultation - Financial System Inquiry - Final Report (2015) Consultation 2015

ASIC Response to Regulator Performance Framework – ASIC measures (2015) Inquiry 2015

Treasury Consultation on Joint Committee on Corporations and Financial Services report into proposals to lift the professional, ethical and education standards in the financial services industry (2015) Consultation 2015

Treasury Exposure Draft - Corporations Amendment (Professional Standards of Financial Advisers) Bill 2015 (2015) Legislation Exposure Draft 2015




Treasury Exposure Draft - Corporations Amendment (Life Insurance Remuneration Arrangements) Bill 2015 (2015) Legislation Exposure Draft 2015

Treasury Exposure Draft - Corporations Amendment (Life Insurance Remuneration Arrangements) Regulation 2016 (2016) Legislation Exposure Draft 2016

Senate Economics Legislation Committee inquiry into Corporations Amendment (Life Insurance Remuneration Arrangements) Bill 2016 (2016) Inquiry 2016

Senate Economics Reference Committee inquiry into scrutiny of financial advice (2014 - ongoing) Inquiry Ongoing

Senate Economics Reference Committee inquiry into criminal, civil and administrative penalties for corporate and financial misconduct or white-collar crime (2015 - ongoing) Inquiry Ongoing



INDUSTRY FUNDING MODEL FOR ASIC

An equitable model is needed Political action required: Call for:

1. The commencement of the industry funding model for ASIC to be delayed by at least 12 months due to the uncertainty of:

a. implementation of the Financial System Inquiry (FSI) and PJC Inquiry recommendations, and ASIC Capability Review, and

b. the impact of the current reform agenda on ASIC’s surveillance and education activity.

2. The development of a more equitable funding model that is aligned with government

policy and consistent with small business exemptions of other regulators. Why? Proposed model hits small business hardest

Under the proposed levy, small licensee businesses (those with 5 advisers or less) will pay at least twice as much per adviser as medium and larger licensee businesses.

Levy type Description Amount

Levy for single-adviser licensee

Levy for small licensee of 5

advisers

Levy for medium licensee of 50 (authorised

representative) advisers

Levy for large

licensee of 250 advisers

1 Company

levy

Small proprietary company

$5 $5 $5 $5

Large proprietary company

$350 $350

2 A levy for

authorisati-ons

a) a flat base levy for the license authorisation

$250 $250 $250 $250 $250

b) levy for each advice authorisation held by an AFSL

$250 x number of advice authorisations

$1500 $1500 $1500 $1500

c) levy for each dealing authorisation held by an AFSL

$250 x number of dealing authorisations

$1500 $1500 $1500 $1500

3

A levy for the

business activity

Levy for providing Tier 1 Financial Advice

$1,350 $1,350 $1,350 $1,350 $1,350

Levy for each financial adviser on the Financial Adviser Register (FAR)

$470 x each adviser on the

FAR $470 $2350 $23,500 $117,500

4 Additional

annual levy

Securities Dealers (flat annual levy)

$1,600 $1,600 $1,600 $1,600 $1,600

TOTAL $6,675 $8,333 $29,705 $124,070

Cost per Adviser $6,675 $1,666 $594 $496


This will1: o create a barrier to entry for small licensee businesses and single-adviser licensees o push small licensee businesses and single-adviser licensees to cancel their license

and join a dealer group o compel financial advisers to remain with large financial institutions rather than seek

their own independent licence o restrict trade and negatively impact on the ability of small licensees to compete in the

advice market o limit client service offerings and unfairly restrict business growth of small licensees.

Proposed model does not reflect ASIC activity or risk-based approach to regulation

The proposed funding model is not consistent with ASIC surveillance and education activity.

It will have a much greater impact on small licensee businesses, but the Regulator’s focus is typically on larger licensees.

ASIC rarely engage with small licensees – research shows most small licensees had no interaction with ASIC for more than 12 months.

ASIC have understandably allocated substantial resources to large licensee businesses over the last few years. This can be seen through Enforceable Undertakings, ongoing surveillance activity and submissions to various Parliamentary committees and inquiries.

ASIC’s focus is on those businesses that pose the highest risk to consumers. This is not reflected in the proposed funding model.

ASIC Corporate Plan for financial advice states: ‘…will act to address conflicted advice, misaligned incentives and risk management, particularly in large vertically-integrated institutions.’

Proposed model is inconsistent with Government funding policy

From the introduction of its industry funding model, AUSTRAC has provided an exemption for small licensee businesses. This exemption was extended further in the May 2014 Federal Budget.

This clearly demonstrates the Government’s policy position in relation to imposing industry levy’s on small business.

Financial services reform agenda

Uncertainty in relation to: implementation of FSI and PJC Inquiry recommendations; and Government’s response to ASIC Capability Review means ASIC’s costs are unknown. In turn, the proposed model’s objectives of ensuring costs are borne by the right users is not achieved

The proposed model is inconsistent with the PJC Inquiry recommendation “to increase fees for organisational licensees to reflect the scale of their financial advice operations…….” (Recommendation 6) as small licensees will have to pay twice as much as large institutions.

1 FPA survey respondents indicated that:

46% would cost the levy directly into the fees charged to clients;

29% would not be able to employ new people;

20% would potentially reduce staff numbers;

54% said they would have to restrict business growth;

37% said they would have to restrict their client offering;

7% said their business would become unprofitable/unviable; and

7% would cancel their license and join a dealer group

IMPROVING ACCESS TO ADVICE

Tax deductibility of advice fees

Political action required

1. The preparation of an initial financial plan, and ongoing management fees or annual retainer

fees, be expressly stated to be tax deductible.

2. The Government engage the Productivity Commission to examine the short-term and long-

term position of the Budget if the preparation of an initial financial plan and ongoing fees

were tax deductible. This report should be robust to a variety of different solutions, such as

means-tested or capped tax deductions.

Why?

To encourage a savings culture and improve Australians’ retirement preparedness to reduce

reliance on the social security system

Changes to the superannuation system in the 2016 Federal Budget will force financial

planning clients to redo their financial plan, particularly in relation to transition-to-retirement.

Cost is one of the top barriers preventing consumers from seeking personal financial advice.1

Public policy initiatives to improve access to affordable advice for all Australians, particularly

those most in need of assistance in managing their finances, will reduce the cost of advice

for consumers while maintaining consumer protections and advice quality.

Consumer benefits

To reduce the cost of financial advice for consumers and make it more accessible for all

Australians.

Research shows those who do not currently receive financial advice feel less prepared for

retirement than those who do use a financial planner.

1 Investment Trends "Financial Advice Report", August 2015


Quality financial advice can

reduce financial and social exclusion for consumers and help them navigate the financial

marketplace and learn how to better manage their finances.

change savings behaviour, setting proper budgets, following a plan for paying off debt, and

organising finances and building wealth

change people’s behaviour and habits of managing their financial affairs by teaching them

sensible and simple practices that can be used in their everyday lives to prepare for their

future financial needs.

Help improve the financial capability of consumers, enabling them to make informed

judgements and effective decisions about the use and management of money throughout

their lives.

Government benefits

Assist Government to fulfil its obligation to address the substantial issues of financial and social

exclusion by helping consumers gain access to expertise to help them navigate the financial

marketplace and learn how to better manage their finances.

There are clear societal benefits of financial advice:

higher levels of savings – reduces reliance on government benefits during and after

retirement.

a financially literate and conscientious society that would make better long-term decisions.

reduced debt - increases disposable income for more productive purposes.

higher rates of return on investments over long periods - building wealth.

insurance protection - prevents people from relying on welfare.

Precedent and consistency in tax treatment of professional fees

The precedent of tax deductibility of professional fees is already set and allows consumers to

deduct fees paid to registered tax agents, BAS agents and lawyers.

Since July 2014, financial planners have be required to register with the Tax Practitioners

Board as tax (financial) advisers, and adhere to the requirements of the Tax Agent Services

Act, along with their tax agent peers.

The amendment to the Tax Agent Services Act defines a tax (financial) advice service as a

type of tax agent service.

Including financial planners in the Tax Agent Services regime, and the banning of

commissions on financial advice, sets the right environment for the introduction of tax

deductibility of financial advice fees.


IMPROVING CONSUMER PROTECTIONS

Financial System Inquiry recommendations

Political action required

Support the following recommendations of the Financial System Inquiry:

1. Stronger product regulation

Introduce a targeted and principles-based product design and distribution obligation to

strengthen product issuer and distributor accountability (recommendation 21)

Remove regulatory impediments to innovative product disclosure and communication

with consumers, and improve the way risk and fees are communicated to consumers

(recommendation 23)

2. Enhanced ASIC powers

Introduce a proactive product intervention power that would enhance the regulatory

toolkit available where there is risk of significant consumer detriment (recommendation

22)

Provide ASIC with stronger regulatory tools (recommendation 29)

3. Renaming ‘general advice’

Amend the Corporations Act to change the term ‘general advice’ to ‘general information’

and be limited to the provision of 'factual information and/or explanations' relating to

financial products, to clearly differentiate financial advice and product sales

(recommendation 40)

Why?

1. Stronger product regulation

There are multiple participants who offer financial products or services who influence

consumers’ decisions on financial matters, including:

o Product manufacturers and fund

managers

o Platforms

o Property schemes

o Ratings agencies and research

houses

o Investment banks funding the

development of financial products

sold to consumers

o Auditors of products and product

manufacturers

o Accountants of product

manufacturers

o Accountants (of consumers) operating

under the accountants exemption

o Stockbrokers / share brokers

o Futures brokers

o Australian Deposit Institutions (banks,

building societies, credit unions)

o Insurance brokers and companies

o Unregulated participants (including some

accountants) acting as financial planners

o Regulatory agencies including ASIC and the

ACCC

o Professional Indemnity Insurers


Each of these participants play some part, either directly or indirectly, in influencing

consumers decisions to invest in a financial product and the ongoing stability of that

product.

Product providers should be held accountable for failing to deliver on product benefits

due to dishonest conduct, fraud or insolvency, or if there are fundamental flaws in

products.

Currently many of these entities or their products are not regulated, meaning they are

not held accountable for their actions and do not have a legal responsibility to the

consumer for the provision of financial products and services to consumers.

These gaps in the law create significant risks for consumers and significantly undermine

the role and powers of ASIC and the value of legislation which serves to protect

consumers.

2. Enhanced ASIC powers

Currently ASIC does not have legislative obligations to regulate financial products.

ASIC’s oversight of product providers is limited to matters of corporate governance and

disclosure, and in the main, not on the design and other issues related to the products

they sell to consumers.

Legislation must enable ASIC to effectively and proactively regulate product providers

and the products they develop and sell to consumers.

3. Renaming ‘general advice’

‘General advice’ should be renamed to clearly separate the provision of financial advice

from product selling

Framing ‘general advice’ as advice gives the impression to a consumer that the

information they are receiving is based on their personal circumstances and that the

product is appropriate for them.

Some consumers incorrectly mistake the use of the word ‘advice’ to mean guidance (as

per the standard definition). General advice is product information, not guidance.

Anecdotal evidence shows that it is common for individuals to interpret general advice

or product information as personal advice because it is relevant to their circumstances

at the time they receive the information.


WHAT IS FINANCIAL PLANNING?

What do financial planners do?

Financial planning is a process of developing strategies to help people manage their financial

affairs and take control of their finances to meet life goals.

Financial planning is about helping people set goals and devise a plan to prepare them for the

future and give them confidence about their financial security.

CLIENT NEEDS

A client’s six financial planning needs sit at the heart of what financial planners do.

Financial planners work with clients to identify

and consider:

each client’s circumstances including their

needs, goals and priorities

the values, attitudes, expectations and

financial experiences of their client,

particularly in relation to risk tolerance

their client’s ability, both financial and in

relation to their level of comfort, to tolerate

loss of capital

their client’s financial planning needs across

the short term, medium term and long term

non-monetary matters that may affect their

client’s financial needs and goals

Based on this information, a financial planner will develop a financial plan with appropriate

strategies that their client is comfortable with, to help them work towards their life goals.

Financial planning can help with debt management and reduction, budgeting, cash flow

management, a savings plan, superannuation, tax planning, home loan repayments, insurance,

investments, as well as planning for retirement.

FINANCIAL PLANNER’S RESPONSIBILITIES

A financial planner’s responsibilities are to make clear recommendations, outline the risks

involved and communicate any possible strengths or weaknesses in the plan.

The level of investment risk will be stated in the financial plan and should reflect the risks

the client is comfortable with taking.

For those receiving long term financial planning, the financial planner will: keep clients

updated with changes that could influence their investments, such as market slumps;

provide regular reviews of the financial plan; and regularly evaluate client’s needs, financial

goals and strategies.

Financial planners help educate clients: with financial matters; and to identify changes (big

and small) that may influence their goals – or change their attitudes – relevant to their

financial planning needs, so such events do not go unrecognised by the client.

FPA members must: put their client’s interests first and uphold the professional standards in

the FPA Code of Professional Practice; and meet the best interest duty and other obligations

in the law.

FPA Client Needs Wheel


HOW THE FINANCIAL PLANNING PROCESS WORKS

1. DEFINING THE RELATIONSHIP

The financial planner should explain the process they will follow, work with their client to

identify their needs and make sure they have the competency to meet them. The

financial planner should discuss their background, how they work and how they charge.

2. IDENTIFYING CLIENT GOALS

Working with their client, the planner identifies their client’s short, medium and long

term financial goals – this stage serves as a foundation for developing the financial plan

that is in the best interest of the client.

3. ASSESSING THE CLIENT’S FINANCIAL SITUATION

The planner will assess their client’s current financial position – their assets, liabilities,

insurance coverage and investment or tax strategies.

4. PREPARING THE FINANCIAL PLAN

The planner recommends suitable strategies, products and services that can be

demonstrated to be in the client’s best interest and appropriate for the client’s needs

and circumstances.

5. IMPLEMENTING THE RECOMMENDATIONS

Once the client has agreed to the financial plan, the planner will implement it. The

planner will inform the client if the implementation of the plan requires the assistance of

specialist professionals, such as an accountant or solicitor, and any cost involved.

6. REVIEWING THE PLAN

A client’s circumstances, lifestyle and financial goals commonly change over time, so

it’s important the client’s circumstances, needs, and financial plan are regularly

reviewed.

COMMON REASONS PEOPLE SEEK FINANCIAL ADVICE

Financial advice is not just for the wealthy. It helps people plan for things as simple as a holiday,

to something as complex as buying a property, or retiring comfortably.

People commonly seek financial advice when they hit major life milestones such as:

Establishing and building a career

Starting a family.

Their attitude towards financial matters

changes or they become anxious about

their financial affairs

Getting a tax refund/bill or bonus

Receiving an inheritance/windfall

Losing their job

Redundancy

Changing job and income

Self-employment / business partnership

Divorce or separation

Losing their partner

Change in dependents

Changes in lifestyle e.g.

hobbies/interests

Dealing with illness

Renovations

Travel/holidays

Increased debt

Changes in the economy

Changes in the law

Investment performance

Media coverage


ABOUT THE FINANCIAL PLANNING ASSOCIATION

Established in 1992, the Financial Planning Association (FPA) is Australia’s leading professional

association for financial planners. We support Australian consumers by standing for the

following:

Public Interest

The FPA’s first “policy pillar” is to act in the public interest at all times. We actively champion the

need for a clear separation between product sales and advice, because Australians deserve

trusted and transparent financial advice.

Professionalisation

We believe that it is paramount that financial planners hold and maintain a high standard of

education, knowledge, skills and experience necessary to deliver quality financial advice that is

in the best interest of Australians. We support members with a robust continued professional

development program and practical guidance across a wide range of areas.

Accountability

We create a professional culture of accountability and self-regulation, setting and enforcing high

standards that require and inspire our members to be ethical, honest, transparent and respectful

when assisting clients. The FPA Code of Professional Practice is a world-class framework that

provides additional consumer protection and best practice guidance for our members.

Our independent Conduct Review Commission investigates complaints against members who

are suspected of breaching of our professional standards and rules.

Education

The FPA is the only certification body for financial planning in Australia. We are the only

Australian body licensed to administer the CERTIFIED FINANCIAL PLANNER® designation,

also known as the CFP® designation.

Globally recognised in 26 countries, the CFP® designation is the highest certification for

financial planning worldwide. Outside of the US, the designation is owned by the global

Financial Planning Standards Board (FPSB). There are over 5,550 CFP® professionals in

Australia and over 160,000 worldwide.

The FPA has also built a curriculum for degrees in financial planning, with over 17 higher

education providers around Australia.

About the FPA membership Having removed corporate membership back in 2011, the FPA now only offers individual

membership. This means that our strict membership criteria and professional standards apply

directly to the individual providing financial advice to clients. As at May 2016, the FPA had a

9,2691 voting practitioner members.

The criteria to become a voting practitioner member of the FPA exceeds the legal requirements

for providing personal financial advice to Australian consumers:

FPA practitioner membership category

FPA requirement Legal requirement for providing personal advice

CFP® Professional (over 5,550 members)

(from 2007) Completed the CFP® Certification Program (entry to the CFP Program requires degree or Grad diploma and compliance with ASIC’s RG146)

• At least 3 years relevant industry experience

• Subscribe to a professional code (inc ethics)

• Ongoing CPD

Current:

• ASIC RG146 compliant

(effective from 1 January 2019)

Proposed:

• Completed a relevant undergraduate degree

• Undertaken a professional year

• Passed an exam

• Subscribes to a code of ethics (effective from 1 January 2020)

• Meets ongoing CPD requirements

• Transitional arrangements apply to existing advisers.

Financial Planner AFP®

(over 3,700 members)

(from 2013) Hold an Undergraduate degree or higher. Has at least:

• 1 years’ supervised experience in a financial planning related role

OR

(from 2015)

• Holds an Advanced Diploma in Financial Planning

• Has 6 years’ experience in the previous 8 years

• Completed FPA Code training

• Meets CPD requirements

PLUS

• ASIC RG146 compliant

• Subscribes to a professional code (inc ethics)

• Meets ongoing CPD requirements

Membership Breakdown

As at May 2016, the FPA had 9,2692 practitioner members. Below is a sample breakdown of the

FPA membership base:

5,533 CFP® Professional members

3,736 Financial Planner AFP® members

Nearly 22% of our practitioner members are women

20% of CFP® professional members are women

40% of CFP® professional members are under 45 years of age.

1 May 2016 2 May 2016

FPA practitioner members by state

NSW 2964

VIC 2688

WA 872

SA 728

TAS 193

ACT 186

QLD 1593

NT 33

Overseas 12

The FPA in the community

FPA’s Future2 Foundation

Future2 offers an active channel where FPA members give back to the community. Since the

FPA established the Future2 Foundation in 2007, the foundation has committed $613,000 in

grants to not-for-profits who provide programs that help socially or financially disadvantaged

youth throughout Australia.

The Future2 grants program supports a wide range of programs:

Education, including skills training and leadership development

Engagement, including mentoring and juvenile justice programs

Employment, including work experience and job readiness training

Wellbeing, including remedial programs for drug and alcohol dependence

Independent living, including addressing social exclusion and homelessness.

To raise these funds, FPA members take part in fundraising activities and make monetary

donations to Future2.

Financial Advice Pro Bono Service

The FPA strongly supports the provision of pro bono financial advice for those who are

disadvantaged, or find themselves in financial distress. We believe that giving back is an

important part of any profession, and are proud to say that FPA members are active in this area.

Over the years, we have implemented pro-bono referral programs to connect FPA members

with the victims of natural disasters and other stressful circumstances, so that they can receive

financial advice free of charge. This advice can help people manage change in their personal

and working lives, take control of their financial circumstances and plan for long term self-

reliance.

Financial Literacy

Financial literacy is of national importance, contributing significantly to the social wellbeing and

financial security of individuals and families, as well as the strength of the Australian economy.

The FPA community is passionate about improving the financial literacy of Australians, and as

such, there are a wide range of financial literacy programs that take place throughout the year:

Presentations to schools and university students

The annual Financial Planning Week (22-28 August this year)

“Ask an FPA Expert” online (usually open in Financial Planning Week)

Community financial education programs.

The production of consumer website information, brochures and flyers

In addition to these programs, the financial planning process in itself is a major contributor to the

financial literacy of clients. The role of a professional financial planner is to empower clients with

the financial knowledge to take make sound financial decisions and take control of their

finances.

Documents

FPA ADVOCACY: HOW TO ENGAGE YOUR LOCAL MP · There are many ways you can engage with your local MP, such as writing a letter, phoning, emailing and following them on social media