Process and proceed
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Solvency 2 will reduce annuity rates at the very time that many individuals do not have enough in their retirement pot, Solvency 2 will not affect the policymakers and this ongoing set of decisions that affect all but those who make them needs to stop.
Keeping to the topic of retirement provision, I have read with some interest the commentary with regard to various providers - those supporting adviser-charging under GPPs and those firmly against the suggestion.
I sometimes think that people are all too often looking down the wrong end of the telescope. For far too long in this country, the cost of advice relating to the provision of employee benefits has been erroneously provided through comm- ission and more recently, with the significant reductions in commission levels, it is no longer substantial enough to cover the actual cost of running schemes, never mind advising the members.
I strongly suspect that if IFAs were in a position to accurately record the time they spent on group personal pension schemes, they would discover they were not profitable in the absence of some kind of fixed fee for service.
What is essential is that as adviser-charging is introduced for group PPPs and other group schemes, this needs a proposal which not only engages the regulated but also engages the employer population at the same time.
It is quite clear that employers do value quality advice. They use it for things like Investors in People, for obtaining an ISO mark and for taking their own business forward and developing brand campaigns, advertising, PR, etc.
What we need to do is align ourselves in the correct part of the mindset of the average employer that it is a service that is worth paying for and it is a service that adds value.
To do this, we need to be clear about what we are providing and I have always held the opinion that the best way to do this is to sit down and write down everything that you do when you are looking after client in a particular area.
Failing to do this is, as a man once said, planning to fail and therefore, without that process map, you are not generally in a position to comment on a significant or a serious way on what is actually going on.
Process is at the heart of quality service and it is a failure to recognise that or a willingness to try and hang on to an outdated way of being paid that is only delaying the inevitable and it may well result in the employer going elsewhere.
As Joni Mitchell went on to say: "They paved paradise and put up a parkin' lot" - or should we say they demolished advice for those who need it most?
I sincerely hope I am not right, adviser-charging for GPPs is an opportunity to move forward and we need to avoid ending up with the market equivalent of "a parkin lot".
Robert Reid is managing director of Syndaxi Chartered Financial Planners
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