From this date, new advisers will be required to hold a relevant degree before they are eligible to start the supervision year and sit the exam. Existing advisers will have two years, until 1 January 2021, to pass the exam and five years, until 1 January 2024, to reach a standard equivalent to a degree.

SMSF Association managing director and CEO Andrea Slattery said SMSFA has “long advocated the lifting of educational and professional standards in the financial advice sector” and the bill is “a critical step” to ensure consumers have access to the best financial advice.

“Higher educational standards are essential to nurture a respected financial advice profession and give consumers confidence in the advice they are receiving,” Mr Slattery said.

The SMSF Association also commended the government for adopting a co-regulatory approach to improve professional standards in the industry.

“The establishment of a statutory standard-setting body to govern the professional standing of the financial advice sector is an excellent step,” Ms Slattery said. 

“A key priority will be to ensure that the new education standards recognise the importance of specialist advice areas, such as SMSF advice, which is critically important as about 1.1 million Australians have $636 billion in retirement savings invested through the SMSF sector.”

She also welcomed the transitional time frames to allow current advisers to meet the new educational standards.

"Advice professionals should not be complacent and remember their professional duty to clients to keep improving their knowledge and skills”, she said.