When the AIOFP was established in 1998 we were told there were too many Associations and Canberra was getting confused with who to deal with. Today we have 14 different Associations resulting in an ongoing political disaster for the Advice community over the past 25 years, this must change.

With a new Government in power the Advice community has an opportunity to commence a new era when dealing with Canberra.

The Mortgage Industry has the perfect environment for Association performance, 2 entities who work collaboratively and both act in the best interests of their Adviser members.

In comparison, the Advice community has 14 Associations who rarely act collaboratively and with some acting in the best interests of Institutions or consumers not Advisers.

The Life Insurance Framework [LIF] legislation is a classic example of Advisers thinking they had 3 Associations acting in their best interests when dealing with Minister O’Dywer but the opposite actually occurred.

Was this a betrayal of Adviser members needs or Advisers not realizing who they had invested their political capital with?

Let’s look at the facts. The 3 Associations were the Financial Planning Association [FPA], Association of Financial Advisers [AFA] and the Financial Sector Council [FSC]. The FPA priority is to Consumers not Advisers, the FSC’s members are Institutions not Advisers and the AFA background is the Life Underwriters Association [LUA AMP/National Mutual agents].

The LIF issue was justified by Government insisting Consumers would be better off with a lower costs/no churning political platform and all three Associations supported O’Dywer’s 60% level and not the Advisers 80 – 90% objective.

So what happened? The consumer focused FPA acted in what they considered to be the best interests of Consumers at the time, the FSC was always going to support their Institutional members and the AFA was arguably the only Association who betrayed their Adviser members.

The important lesson here for Advisers is before joining any Association analyze what their charter is [ie who they prioritize] and the characteristics of their member cohort, do not make decisions based on ‘bells and whistles’ like designations and discounts.

Canberra needs to understand that the industry is made up of ADVISERS, INSTITUTIONS and CONSUMERS with each sector having their own Associations to select from. For example –

  • if a Politician wants information about Product, they go to either the FSC or ABA the representatives of the institutional product manufacturers.
  • If they want information about Consumers they go to Choice or the FPA who are both consumer advocates.
  • Due to the different categories of Advisers [SMSF, Stockbrokers, Financial Advisers including Risk] a panel is established of 3-4 Associations covering each discipline.

A Directory of the prominent Associations covering the different sectors of the industry will provide clarity and education to Canberra when seeking information.

With diminishing Advisers numbers and far too many Associations all trying to justify their existence, Advisers have the power to decide the future by voting with their political capital and selecting their preferred Association.

The Advice community should not have Consumer or Institutionally focused Associations representing us in Canberra ever again, that has been the source of our immense pain over the past 9 years and beyond.

More information shortly.


Peter Johnston | Executive Director
Association of Independently Owned Financial Professionals
Suite 1211, 1 Queens Road, Melbourne VIC 3004
P 1800 111 203, d 03 9863 7574, m 0418 857 621 | Download my business card

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