Origins
The PAA Legacy Trust was set up to accept the financial assets from the Professional Advisers Association (PAA) following its winding up. The PAA agreed that the future best interest of its members lay in joining together with the Institute of Financial Advisers (IFA) to establish a new financial adviser professional body called Financial Advice New Zealand. Following the conclusion of the winding up of the PAA itself in December 2019, the last of the PAA assets (which included the proceeds from the sale of its holiday homes) were then transferred into the PAA Legacy Trust in line with the PAA Constitution directing any transfer to be to a not-for-profit or charitable fund or organisation.
PAA Heritage
The original PAA had been established in 1953 as an incorporated society, initially to represent the interests of the life agents of the Prudential Life Assurance Company in New Zealand. Following mergers and acquisitions of life insurance companies in the 1990s, the PAA re-branded as the ‘Professional Advisers Association' and increased its membership to including advisers representing other life insurance companies. As members broadened their range of products and advice from just life insurances, the organisation evolved to representing advisers distributing investments and superannuation, mortgages and fire and general policies.
Originally structured as a member benefit organisation, the PAA grew to become a fully equipped professional body. This growth path encompassed the introduction of an educational pathway for members, access to professional indemnity and group life and TPD insurance, implementation of a PAA code of ethics and a complaints procedure as well as the introduction of practicing certificates and monitoring Government legislation and contributing to proposed regulations. Further consolidation occurred with the NZ Mortgage Brokers Association membership joining in 2012 to provide scale. In 2015 the first joint conference between the IFA and the PAA occurred, representing another step towards merging interests.
The holiday home scheme was first established by the PAA not only to provide holiday options to members but to seek an improved return on low yielding debenture assets accrued by the PAA in its early years to run its own conference and to be able to send negotiators to the Prudential Head Office in London. In 1983, the first home was purchased in Taupo, with others added in time to total of seven in the end, including two in Australia. Over time the holiday home scheme became economically impractical and a drain on general subscriptions without all members enjoying access to them. After extensive consultation the decision was finally taken in 2016 to sell the homes.
Looking forward
The funds and purpose of the PAA Legacy Trust will continue to foster the interests of financial advisers and financial advice in the NZ community - an objective that is a 21st century version of the aspirations of the original association members.