Simon Hassan recently stepped down from his role at Hassan and Associates and is operating as a consultant, as well as being chair of the Financial Advice NZ certification committee.  He is a former president of the IFA.

He said most adviser bodies were funded by growing their numbers.

"Financial Advice NZ is a prime example. As with each its predecessors, it has two main sources of income: Members (subs and other fees) and  suppliers of financial products (sponsorship in one form or another). The more members, the more sponsorship: the more 'successful' the organisations, the larger the top job, the more cash in the pool for director’s fees. It can all look pretty good – until you think again of how consumers fare, and the notion of a trusted profession."

The imperative of membership growth was in conflict with any push for higher standards.

But Hassan said, to foster the emergence of a genuine profession of financial advice, organisations had to be immune from influence.

"Their funding – or at least the bulk of it – should not be linked to member numbers, or dependent on the conflicted coffers of the big suppliers," he said.

"This is a problem that cries out a role for governments. If it is in the public interest (and it is) to have a strong financial advisory profession that helps develop and promotes pathways to higher standards that will see trust grow and better outcomes for consumers, taxpayer dollars could be very usefully be spent here."

There are about 1800 members of Financial Advice NZ. Hassan said, if adviser associations were generating about $1.5 million a year in income between them, they would struggle to do what they should.

"If the government were to put in another $4.5, (absolute peanuts) – and if membership (which at a basic level might just be compulsory) went to let’s say 10,000, the cost for an adviser to belong could fall dramatically – while leaving the professional body with headroom for things like research, standards development, promotion – things members can currently only dream about.

"We can’t expect a group that is reliant on member subs and supplier sponsorship to drive the development of a genuinely 'client-first' profession. And a genuinely client-first profession is essential if trust is to develop. But with taxpayer support I think we could do it. "

Financial Advice New Zealand chief executive Katrina Shanks said an organisation needed to represent its core objects.

"For Financial Advice NZ standards is one of our core objects therefore members have standards which they have to abide by and with the development of the Quality Service Mark this will only enforce our membership standards.

"There are approximately 8000 RFAs and AFAs currently, of which the majority do not belong to a membership based organisation. I believe many of these financial advisers provide high-quality advice in New Zealanders who would benefit from being part of Financial Advice NZ."