IFP says simplified advice needs to be built from scratch
The Institute of Financial Planning is calling for a full review of simplified advice outside of the RDR, saying a thorough assessment from scratch could take up to two years.
Last week, Money Marketing revealed the FSA has delayed publishing guidance consultation on simplified advice until later this year.
In March, FSA chief executive Hector Sants told the Treasury select committee the regulator was committed to publishing a paper on simplified advice by the summer.
IFP chief executive Nick Cann says few advisers, if any, can deliver simplified advice and achieve profitability without significant changes to regulation. He says a complete overhaul of the work done so far on simplified advice is needed to find a solution that is attractive to the public and advisers.
He says: “It is going to be a fairly long and drawn-out process to be able to get simplified advice right and in order to do that, we need to start from scratch and see what the best ideas are. Then you need to appease the Financial Ombudsman Service and regulatory bodies, which will take a good 12 months to two years.”
Cann says the rethink is needed to ensure a large proportion of the population is not left without the ability to access financial advice.
He says: “Using the internet more effectively to view and consider people’s situations should be a given. The need for consumers to complete separate fact-finds with every possible adviser is ridiculous and more should be done to consider such issues from a practical consumer perspective.”
Evolve Financial Planning director Jason Witcombe says: “I think what Nick is saying makes sense. With the RDR being such a large project, it makes sense to have simplified advice as a standalone project and make sure the time is taken to get things right.”