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&#39Learn from Dome and stop meddling&#39

ABI director general Mary Francis has challenged ministers to learn the lessons of the Millennium Dome and leave the design of financial products to providers.

Francis made the explosive comments in a speech at a fringe meeting at the Labour Party conference in Brighton this week, clashing with Treas- ury economic secretary Melanie Johnson, who defended the Government&#39s role.

Francis praised the Govern- ment&#39s work to date but said it should now stand back and leave it to providers to design cheap, accessible products. She used Isas as an example of a Government-designed product that created consumer confusion. She said the lesson also applied to stakeholder and individual pension accounts.

But Johnson, the Treasury minister responsible for financial services hit back, defending the Government&#39s role in product design and claiming it had to step in to restore public confidence.

Francis said initiatives such as the ABI&#39s Saltr, which aims to create standards for the insurance industry, will go a long way towards bringing back consumer confidence.

Francis said: “The lesson of the Dome is that Governments are not experts at designing, selling and marketing andyet the Government has got pretty deeply into designing financial products, Isas, IPAs and stakeholder. Our regulator is pretty deeply into providing consumer information which you cannot do without effective marketing skills.

“Governments too often succumb to complexity and overdesign, especially where tax is concerned. The lesson for Government is now to stand back and let the industry take forward the task of designing simple, accessible products.”

Johnson said: “Government needs to take a lead on these issues. It is important that people have confidence in the financial products they are investing in, which is something they have not always been able to get from the industry.”

Maddison Monetary Management managing director Mark Howard says: “This is great. It is really refreshing that someone has finally spoken out. The Government needs to learn the lessons about financial products. The idea of Isas is great but they are too complicatedso they fall wide of the mark.”


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