Professional Advisers Association votes for change

New Zealand’s second largest advisory body, the Professional Advisers Association (PAA), is changing its strategic direction and is moving to a new level with plans to grow and the appointment of a general manager.

Thursday, April 13th 2006, 6:00AM

The change in strategic directions comes after a survey of members late last year.

PAA asked its members what sort of organisation does it want to be in the future? The choices being to retain the status quo, become a “competing industry organisation, a “co-operating industry organisation, an aggregator or a dealer group. From the survey nearly three-quarters of respondents opted for the “co-operating” industry organisation idea.

President Richard Thomas says the PAA will work with other associations, particularly the Financial Planners and Insurance Advisers Association (FPIA), in the areas of regulation and education.

However, it has no plans to merge with the FPIA.

“We certainly don’t see ourselves being merged with the FPIA,” Thomas says. On the speculation that a merger is on the cards, he said: “There is nothing further from the truth.”

Where it will co-operate is on developing and administering ethical standards, continuing education for members and lobbying government.

Over the past three days members have been briefed on the changes and voted on a motion to increase fees to help pay for a general manager.

Thomas says the resolution was passed and that Dave McMillan would be appointed the acting general manager.

McMillan says it is not a long-term appointment, rather it will be for about a year while regulation is introduced and the PAA moved from an association run by a committee of advisers to a more professional management structure.

Approved Professional Bodies

The PAA is working with the other associations to try and form an Approved Professional Body (APB). Under the proposed changes to adviser regulations APBs will be statutory bodies charged with a number of roles including setting standards, establishing what are appropriate qualifications and/or experience for advisers and dealing with some disciplinary matters.

The PAA is working with the FPIA, the Society of Independent Financial Advisers and the Life Brokers Association. It appears the NZ Mortgage Brokers Association has pulled out of this grouping.

Thomas says the Ministry of Economic Development has indicated that it wants only four or five APBs when the regulations come into force.

The associations have been asked to submit a document outlining what they think an APB should look like.

Thomas says the associations want membership based on competency, rather than educational standards and that the bodies will be “minimalist” and have “a relatively small role.”

Individual associations such as PAA and FPIA will exist outside the APBs and provide membership benefits.

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