Cummings calls for IFA unity
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Outgoing Aifa director general Chris Cummings has urged IFAs to come together to prove to the Government that the sector is a “core part” of the future of financial services.
In his final column for Money Marketing as director general of Aifa, Cummings says IFAs have spent too long fighting internal “wars”.
He says: “I hope the advisory profession recognises its own strengths soon. For too long, too much time and too much energy have been wasted in internecine wars between different types of adviser holding different types of qualification.
“The challenge has always been to serve those who have turned their backs on the financial sector and who are under-saved, under-protected, underpensioned but over-indebted as a result. I sense a change in Government policy to address these issues.
“It is my belief that the advisory profession could be a core part of the solution but it is for us to prove our case.”
Cummings says there are opportunities for IFAs to service an ageing population that will have to be better prepared for retirement and engage with younger generations through technology-based solutions. He says: “For the practices who understand how to use technology, to serve their existing clients and reach out to new ones, these are exciting times.”
Aifa is understood to have interviewed a short list of candidates to succeed Cummings as director general.
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Readers' comments (13)
Evan Owen | 5 Aug 2010 12:43 pm
IFA unity is a mirage Chris, always has been.
I should know.
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terry arch | 5 Aug 2010 12:55 pm
I have been commenting on this situation on many a blog over the past few years. There is too many comments about people being holier than thou from some sector of the iFA community. In addition to this there are quite a number of IFA,s trying to score brownie points over other IFA,s. The FSA are quite aware of this and therefore play ay divide and rule. I know it probably a dream, I wondered what would happen to the FSA or its hybrids if all IFA,s said thats enough and stopped trading on the 1st January 2013. Unfortunately this is unlikely to happen as most IFa,s have an allegience to their clients and also need to earn a living.
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Chris Neil | 5 Aug 2010 1:04 pm
Funny thing that!!!
I was under the impression that one of the roles of Aifa was to do just that; put forward a representative view from IFA's.
I know it hasn't which is why I ceased to be a member a number of years ago.
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Julian Stevens | 5 Aug 2010 1:17 pm
So, before you jump ship Chris (and you never have had the decency to explain why you're going at the very time of greatest peril for the IFA sector), what more do you suggest we do "to prove to the Government that the [IFA] sector is a “core part” of the future of financial services"?
ALL the data, ALL the anecdotal evidence and ALL media reports (including a recent TV programme on the BBC) confirm, not merely suggest, that the worst element of the retail financial services sector, and by a huge margin, is the banks. The FSA knows this full well but not only refuses to act but even to explain why it refuses to act, as seen with the current Barclays/Aviva debacle. This is corruption, pure and simple.
So how, Chris, do you suggest we tackle the fact that, as IFA's, we have to compete on a manifestly skewed and tilted playing field? That is the real problem that we're up against and a load of rosy platitudes aren't going to change that one iota.
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Robert Donaldson | 5 Aug 2010 1:42 pm
In my view he is missing the point. The bulk of the country will not be able to pay for the costs of advice as the rules and regulations are making it too prohibitive for advisors to deal with them.
Someone has to pay my PI cover my FSA costs and my staff costs. Unless you go down the route of guided sales the mass market is hard to deal with.
We are all running a business and that business has to be profitable.
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Anonymous | 5 Aug 2010 1:54 pm
“It is my belief that the advisory profession could be a core part of the solution but it is for us to prove our case.”
We already have Chris. The FSA refuse to acknowledge the fact. It is them you ought to be speaking to not IFAs
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Nick Bamford | 5 Aug 2010 2:11 pm
How can you have "unity" amongst such a diverse group of firms and individuals? The problem is, as it has always been, the label.
IFA means different things to different people which is why so many now use the alternative labels, Wealth Manager, Financial Planner etc.
Each of us has a slightly different view as to what constitutes truly impartial independent advice. Don't get me wrong I actually think that the diverse nature of the intermediary sector is very healthy but it will never be unified.
Thus its diverse nature is both its strength and its greatest weakness
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paolo standerwick | 5 Aug 2010 2:14 pm
Chris you should have been fighting for IFAs with more passion and gusto, hence one of the reasons there seems to be no cohesion amongst us. AIFA should have fought for
1 The long Stop
2 SI 2326
3 FOS appeal system
4 RDR flaws
5 Retrospective legistlation
6 Exhorbitant F-Pack fees
7 Accountability of the regulators/staff
8 Competency of F-Pack staff
etc etc etc..................................
You have left IFAs high and dry and whilst in office on the pretence IFAs were being helped.
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Simon Webster | 5 Aug 2010 2:30 pm
The esential difference in the IFA community is the fees vs. commission debate. That some IFAs are trying to advance the proposition that the only independent advice is fee based is the reason for the pronounced divergence in the sector.
What no one has acknowledged is that you cannot legislate for integrity. People either have it or they don't. In my 30 years experience most IFAs do - as do most accountants and lawyers who are exclusively fee based - but still their PI claims for negligence & fraud dwarf those of the IFA community.
The real difference is that it is the IFAs role to be an agent of the client and to be on the client's side. The role of the tied or multitied agent is to represent their bank or insurer - that is the difference. Whilr there are pros & cons in both fee & commission remuneration this is not the issue; and until IFAs realise this fact we are pretty much all stuffed...
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Harry Katz | 5 Aug 2010 3:25 pm
I do think that some of the criticisms of Chris are so unfair. The vitriol from Julian is quite unwarranted. Any sane human being needs to move on from this job after 5 years, let alone the seven that Chris has been there. If Julian had put his brain in gear first he might have realised that Chris going was an inevitability and the timing was not necessarily his choice. The other outfit decided to offer and he would have been mad to refuse. Perhaps you are all unaware of the hours and punishing schedule that Chris put in and comments other than those of gratitude for what he has done AND achieved are not appropriate.
As to a united voice I believe (I really do) that this will be eminently possible. The RDR will be a great help in this respect as it will hammer out a much more even playing field. We WILL charge fees (or utilise adviser charging) and we WILL be better qualified. WE will have a moral code. The one proviso is that AIFA keeps the faith and cleaves to the ‘I’ and doesn’t sell out to the daft concepts of restricted ‘advice’, ‘basic’ advice or morons (sorry, simplified) advice. None of which are advice at all. The only advice is independent and that has been AIFAs mantra from the start.
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