Govt seeks to raise adviser standards

The Abbott government is seeking ways to lift the professional standards of financial advisers.

After a string of financial scandals over a number of years resulting in mum and dad investors losing millions of dollars through dodgy advice, the government is seeking submissions to a new consultation paper released on Wednesday.

The paper is based on recommendations from an inquiry by the parliamentary joint committee on corporations and finance last year.

The financial system inquiry, conducted by former banker David Murray, completed last year has also recommended better education standards for advisers.

"These inquiries make clear that the current regulatory arrangements are no longer sufficient to ensure high quality consumer outcomes and to maintain public confidence in the industry," Assistant Treasurer Josh Frydenberg said in a statement.

"It is now time to put in place an enduring framework that raises the professional, ethical and education standards of advisers."

The parliamentary committee sought a co-regulatory approach in which government, professional associations, industry and academia work in partnership.

It would be applicable to personal advice on shares, superannuation, life insurance and managed investment schemes.

Submissions close on May 7.