As we move closer to the time to respond to the retail distribution review and other discussion papers, it may well be worth setting out the ABI’s position according to their submission to the original working parties.
In essence, they state that IFAs control 60 per cent of distribution and that this is a problem for their members.
They make it clear that the purpose of the RDR, in their eyes, is to reduce this power. They are silent about why this is to the benefit of consumers.
They are concerned about switching investments between providers. This is churning, in their language. Again, most of that concern is about the effect on their members rather than on looking at why much, if not all, of this movement is clearly in clients’ best interests. The ABI has no way of acknowledging this.
This is not – quite – an attack on the ABI. They are entitled to have a clear protectionist agenda, to favour their member firms and to try to protect them from the effects of consumerism and technology.
They are clearly trying to get to grips with a market they no longer understand and returning to the days of the dominance of the big firms is how they plan to achieve this.
Their allies, the banks, are in the same position, as evidenced by the rather foolish comments by Angela Knight recently regarding market knowledge.
The problem has been IFA complacency. We have not even attempted to use the power inherent in our market-dominant position and have been happy to accept handouts from the likes of Dinosaur Life.
We regard ourselves as a bit of a cottage industry and have not understood our collective strength.
Now, you may believe I am wrong. That’s fine. The critical thing is that we get our disparate voices heard by those that have the power to influence the environment in which we and our clients will be living.
Aifa and the IFP will fight our corner. The CII/PFS will fight their corner. We all need to be heard. Get your responses in. A high volume of sensible responses will influence the outcomes of all these papers.
Please do not leave the playing field open to those who do not have your interests or the interests of your clients at heart.
Chartered financial planner