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Andrew Tyrie vows to keep up the RDR pressure

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Treasury select committee chairman Andrew Tyrie is vowing to keep up the pressure on the FSA after it swiftly dismissed the committee’s  recommendation to delay the RDR by a year.

Yesterday, Tyrie wrote to FSA chief executive Hector Sants to express his anger over the regulator’s decision to reject the TSC report’s key recommendation in an embargoed press release published alongside the report.

Sants responded today by assuring Tyrie the FSA is taking his report seriously and suggesting the FSA will soon be publishing guidelines for eligibility for waivers from the RDR as well as looking at “further mitigating action” to help IFAs meet the RDR deadline.

In an interview with Money Marketing following publication of the letter, Tyrie says: “The death of Parliament has been greatly exaggerated and this will not be the end of the matter. I have no doubt when we next see Hector and the FSA’s chairman Lord Turner that this is an issue we will want to raise. We were very disappointed.”

He says the intentions of the RDR look “broadly right”, but that it needs to be implemented carefully to ensure the advice community and the interests of consumers are not damaged.

He says: “We are asking the FSA to think again, to show some common sense. With some adjustment, we think the proposals may be appropriate, but now we need to implement this with great care and it is with that in mind that our recommendations have been framed. We are talking about these IFAs’ livelihoods and thousands of savers who may be disadvantaged if we get this wrong.”

Tyrie adds the episode is a good example of the behaviour shown by the FSA which has lead the committee to launch an inquiry into the accountability of its successor body the Financial Conduct Authority.

He says: “It tells us so much about what people privately tell us of the FSA- that they simply do not listen enough. There should be someone keeping an eye even on these powerful regulators, everyone should be accountable to somebody.”

The TSC’s report on the RDR, published over the weekend, calls for the January 1, 2013 implementation date to be put back a year to give advisers more time to meet the QCF level four qualification requirements, alongside a softening of the cliff-edge deadline for experience advisers. The FSA released an embargoed response alongside the publication of the report which rejected the MP’s key recommendations and stated it remains committed to the January 1 2013 deadline.

Tyrie’s letter to Sants says: “We deprecate the Authority’s action. It was precipitate, giving the impression that no adequate consideration had been given to the arguments for the delay we recommend. This is unacceptable.”

In this week’s Money Marketing, Treasury select committee members attacked the FSA for showing “arrogance” and “contempt” for the committee in swiftly dismissing its recommendation that the retail distribution review should be delayed. Labour MP George Mudie (pictured right) says: “Accountability is a hot issue at the moment and this is a case in point. We put a considered view to the FSA and, without much thought and with some arrogance, it pre-emptively told us where to go.”

Conservative MP Andrea Leadsom says: “It is astonishing the FSA would rule it out of court when it was a very strong recommendation and pretty disgraceful that it would get its retaliation in before the committee’s paper was officially published.

“It shows real contempt for the considerable work that went into the report and it is a complete two fingers up to the committee.”
 Liberal Democrat MP John Thurso says: “Maybe it shows that seeing as the FSA is disappearing it has decided not to bother too much any more.”

Conservative MP Mark Garnier says: “The FSA has had a look at the report, shrugged its shoulders and said it is not going to bother with it and banged out a press release in response without even letting us know first. It is pretty unimpressive.”

Labour MP Andy Love says: “We were trying to find a proper balance between the needs of consumers and the difficulties some IFAs are facing in meeting the requirements. I was surprised at how quickly the statement came out but I would hope they would give some consideration of the points we were trying to make.”

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Readers' comments (35)

  • "We are talking about these IFAs’ livelihoods"
    Thankyou Mr Tyrie, The FSA have completely ignored this fact.

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  • The FSA is right for once. RDR should go forward as planned and the qualification arguments are nonsense. It is not like the schedule has not been made widely known and well in advance. To have not reached level 4 by 2013 shows a distinct lack of planning; which is perhaps why those that have not managed this level will no longer be allowed to plan for clients. Those that can, do and those that can't go do somethnig else.

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  • MPs are now beginning to realise that the FSA doesn't listen to anybody - it always knows best (except it doesn't).

    10 years from now RDR will be seen as an unmitigated disaster. I actually believe that the requirement for a higher level of knowledge as evidenced by a few exams is right and proper and no delay should be necessary. It's everything else about RDR that should be consigned to the bin - not postponed, but scrapped altogether.

    One final point - it ironic that those people who never listen to their electorate should now be complaining that the FSA isn't listening to them !

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  • To Holden Caulfield

    Appeasing a bully never works.

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  • Just who does he think he is asking the FSA and old Hector to show some common sense, Paul Daniels?

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  • To HC. Its not just about qualifications. Try to keep up.

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  • holden caulfield
    beware the smug man !

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  • Holden cualfield
    You arrogant little............
    Have you not heard the expression 'to know all is to forgive all'.
    You know very little of the circumstances of the many practitioners with blemishless records who face having their livings STOLEN from them by the FSA acting ultra vires.. Maybe your perfect little life runs like clockwork, but sadly the real world intervenes for the majority trying to stay afloat in a regulatory environment that is simply unacceptable.
    I suggest you keep your trite comments to yourself

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  • Holden Caulfield

    Just checked the FSA register to see how log you have been registered you do not apear on it?
    I have been in this business for 25 years, can I ask you a question if you require coplexed surgery would you go to a surgen with 25/30 years experience and upto dare with his CPD which they have to do instesd of continually sitting the latest exams, or would you choose the newly qualified one with all the latest Qualifications? I guess we all know your answer

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  • I think the TSC are still missing the main concern ie commission. When a client instructs me to advise on post retirement income and I charge a fee of £1,500 - £2,000 he / she will run to the bank without understanding the true cost implications. Or what about the client who wants to set up a new pension plan at £200 per month. Do I charge him £1,000 up front? Can they afford this or will they again be forced to the bank?

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