‘Policy failure’: accountants needed to close the retirement advice gap, says IFPA

The number of financial advisers has been falling since 2019, with respondents to a recent FAAA survey saying the Compensation Scheme of Last Resort (CSLR) levy will accelerate adviser exits. According to the Financial Advice Association Australia (FAAA), there has been a 48 per cent reduction in the number of financial advisers in less than eight years, from around 28,000 ASIC-registered advisers in late 2018 to around 15,135 on 12 March 2026. 

In a submission to Jobs and Skills Australia, Sarah Abood, chief executive of the FAAA, noted that, according to the Future Skills Organisation Workforce Plan 2025 Occupations Dashboard, there would be demand for 64,287 financial investment advisers and managers in 2025 and 69,135 by 2030.

The accountants’ exemption, repealed in 2016 as part of the Future of Financial Advice reforms, and the complexity of the replacement limited-licensing regime led many accountants to depart the personal advice space, the IFPA noted.

The removal of the exemption pushed accountants into the AFSL framework for the provision of most SMSF services, which many said was designed to “kill off” or significantly adjust the limited licence structure.

“Demand keeps rising, but the supply of advisers has gone backwards … We are now in a position where the advice market is more credentialled on paper, but less accessible in practice – that is a policy failure, not a success story,” Heathwood said.

Heathwood said that access to affordable advice for Australians without compromising on professional standards can be achieved with a “simple legislative tweak” – a modernised version of the defunct accountants’ exemption, which covers “clearly defined” areas of superannuation advice by accountants.

“[The modernised exemption] leaves every consumer protection in place while giving Australians access to the affordable super advice they need,” Heathwood said. 

The IFPA’s proposed scope of a modernised accountants’ exemption focuses on contribution strategies, transition-to-retirement strategies, account-based pensions, and structurally sound and tax-effective retirement decisions, while ensuring that licensed financial advisers continue to exclusively handle investment advice, including portfolio construction, asset allocation, and managed funds selection.

“This is about regulatory proportionality … Match the licence to the task, recognise the competence that already exists, and stop treating experienced accountants as if they are new entrants starting from zero,” Heathwood said.

 “We have a growing population heading into retirement with complex superannuation and tax needs, but not enough advisers to help them … The fastest and safest way to fix this is to let appropriately qualified accountants step back into carefully defined areas of superannuation advice.”

The Hayne royal commission in 2019, which aimed to tackle misconduct in banking, superannuation and financial services, education and professional reforms, lifted standards but reduced adviser numbers, leaving less access to timely, affordable advice, the IFPA added.

“Accountants do the tax work, the compliance work and the structural planning work around super … They understand their clients’ circumstances in detail – yet they are prohibited from taking the final step and providing the advice their clients clearly need".

Previous attempts to revitalise the accountants’ exemption met with opposition from CPA and CA ANZ, and the government has also recently looked at loosening financial adviser education requirements to address dwindling adviser numbers.