Financial adviser apprenticeship scheme opens
New Model Business Academy (NMBA), the initiative of SimplyBiz Group, has become an authorised apprenticeship scheme provider, approved by the Skills Funding Agency, and will work with financial advice firms to train up their staff, such as administrators and paraplanners, to become advisers.
Tom Hegarty, managing director of NMBA, said the advice sector had been losing advisers since RDR creating a situation where there are insufficient advisers in the country to meet demand for advice.
In addition, the demographic make-up of the sector meant over the next few years there would be many more advisers and adviser business owners looking to retire, which would only add to the problem.
Hegarty said there were three primary solutions to the issue.
1. Employ technology to enable more people to self-advise. This could lead to disastrous outcomes as people tried to DIY manage their wealth.
2. More people could be recruited into the sector. This was not an easy option, Hegarty said, particularly as the historical routes into financial advice, via life and pension providers, had diminished in recent years.
3. Apprenticeships, where existing staff are trained up to become advisers.
Hegarty said the Government had a target of having 3 million people enrolled in apprenticeship schemes by 2020 and they had recently extended the range of apprenticeships from trades into the professions sphere, including financial advice.
How the scheme works
The practical application of the scheme, Hegarty explained, would see an existing member of a financial advice firm, employed for at least 30 hours a week, able to apply for the apprenticeship. Eighty per cent of their time would be spent in the workplace and 20% would be in formal training and gaining qualifications. The cost of the training would be split, with 90% being paid by government and 10% by the firm. The training costs are capped at £9,000, so the most a firm would pay in training would be £900.
Hegarty said that 250 people had already pre-registered for the NMBA apprenticeship, and the Academy would be assessed on areas such as academic propensity and soft skills.
“As a provider we will be benchmarked and scored by, amongst other things, the number of people who complete the programme.
The scheme is open for firms to start applying for funding and the first apprenticeships will start in April. 50 candidates are expected to be enrolled in 2018, increasing to over 100 by 2019/2020.
Hegarty said while the apprenticeship would be aimed at training future financial advisers, he hoped that if it was successful, it would be rolled out to paraplanning and administration roles but they were not on offer through NMBA at this moment in time.
Further information on the NMBA website