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Associations scotch merger rumours

Presidents of the PAA and IFA are denying rumours that the organisations are to merge, despite announcing they will also hold joint professional development days.

Wednesday, December 10th 2014, 6:00AM 4 Comments

by Susan Edmunds

It follows the announcement of a joint conference next year.

In a press release, the associations said: “The profession is well served with CPD opportunities, often giving free CPD days with expert and technical information in a particular field. Increasingly however, there are common business and professional challenges that apply equally across the financial planner, investment, insurance adviser and mortgage adviser worlds.”

It said common issues included how to communicate with clients in a language they understood, how to provide appropriate advice to clients in different asset classes and how to document recommendations.

Andrew Gunn and Angi Mann, the learning and development managers of both organisations, will facilitate the four-hour CPD afternoons with other specialist speakers.

IFA president Michael Dowling said it made sense to pool resources for things such as lobbying on behalf of advisers and professional development. “We’re both working in that space so let’s share what we’re working on so all advisers can benefit.”

He said PAA had a clearer idea of what mortgage advisers wanted and the IFA had more experience with investment advisers. Both organisations deal with risk advisers.

But Dowling said there were no plans yet to merge the organisations although he did not rule out it ever happening. “There’s too much stuff we should be involved in, if we were to wrap up our resources looking at a merger it would mean we weren’t spending time on the things we ned to spend time on, such as the Financial Advisers Act review and professional development opportunities.”

PAA president Bruce Cortesi said it was not something being considered at the moment. All professional bodies meet regularly with the FMA together, he said.

“We value our relationship with other professional bodies and the FMA. There has been a bit of speculation regarding IFA and PAA we feel that given the current climate in the industry it makes sense to work together to deliver service to members. We can work together to save costs. Given that both organisations have the same vision to educate members and help members, why not work together where there is common ground?”

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Comments from our readers

On 10 December 2014 at 12:04 pm Pedro said:
The advising industry would be better served by one industry body representing the profession. Do the investing public know the difference between the IFA, PAA, and SIFA? I doubt it. However they understand the Banker's Association or the Law Society. We want to be seen as a creditable professional body in the eyes of the public. We have a Code to follow and an Act of Parliament. Having one body overseeing the implementation, accreditation, on going training, dispute resolution and promotion of the industry makes better sense. We would also have a unified voice to deal with the FMA. The industry needs to move passed the egos and put in place a solution for the industry players and more importantly the investing public. I am not currently a member of an industry body as I am not sure which is the best fit. The point I am making is that the IFA and PAA should combine sooner than later and bring the other representative groups under the one umbrella. It will be better for the industry and the investing public.
On 11 December 2014 at 10:28 am Murray Weatherston said:
Pedro, we already have
"one body overseeing the implementation, accreditation, on going training, [and]dispute resolution" that you mention - its the FMA.

It is hardly likely state regulation will give way to self-regulation any time soon

If industry bodies are to merge, it is important they do so for the right reasons. My reading of the merger of the old IAP and LUA in the later 1990s is that it was "forced" by the manufacturers who said "we won't continue to sponsor 2 entities but we will support one"

I have come to the view that if there is to be industry body reform, it should be by the establishment of a new entity where membership is restricted solely to AFAs. The reason is that the interests of AFAs and the interests of registered but not authorised advisers may not always be the same - e.g. why should a simply registered adviser's subs be used to promote AFAs? No manufacturers reps would be members unless they were also an AFA.

The currently regulatory model has crested 2 groups of advisers - those who are AFAs and those who are not. Perhaps there should be one new professional body for each group.
On 11 December 2014 at 4:31 pm dcwhyte said:
...or if a review of the regulatory model required all financial advisers to be qualified to a minimum standard?
On 11 December 2014 at 6:47 pm susanedmunds said:
A comment from Wayne Smith, TripleA:
Last month in Good Returns the IFA and the PAA made a joint announcement that they would stage a combined National Adviser Conference in 2015.

Now if you jump online and have a look at the financials for the IFA and the PAA you will quickly see at least one reason why this is a sensible move. The TripleA, as a much smaller Professional Body for advisers, is in the same boat basically running conferences as a standalone professional body is a loss making venture for all of us and consumes an inordinate amount of staff time.

This move by the IFA and PAA demonstrates some positive industry leadership and they should be applauded for it. The benefits go beyond some modest cash savings for the Professional Bodies and it’s worth thinking about these for a moment and where the concept could potentially head.

Firstly for advisers they will be the beneficiaries of a larger, better resourced and hopefully a truly national level conference that ideally should become the preeminent, cornerstone event they attend each year. This is particularly important for non-aligned advisers.

Secondly for sponsors I’m sure they would welcome some sensible rationalisation of the current plethora of conferences and the associated conveyor belt of people knocking on their door seeking sponsorship funds. Some of the larger sponsors such as AMP and Fidelity actually have a huge amount of leverage in this space. It would only take one or two linking their support to a single, national conference open to all non-aligned advisers to firstly guarantee its emergence and secondly accelerate its development into a major event well worth their support over the long term.

There are other benefits that will accrue over time. The networking opportunities for advisers and sponsors would be greatly enhanced, all the players in the sector from advisers, to sponsors to the Professional Bodies would without doubt get much better bang for their bucks.

It signals closer collaboration by Professional Bodies which is a sensible move if we are genuinely interested in putting advisers first something the regulators would welcome. Closer collaboration and a united front would also give the profession more clout and that’s not a bad thing either.

The TripleA Board welcomed the announcement and we hope the fact it’s being referred to as a National Adviser Conference is a subtle signal that the door is open to other players to join this initiative and make it a success for all concerned.

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