At the PFS RDR conference on Friday last week, head of industry development Peter Williams said it was interesting to note that the FSA all but dismissed basic advice in last November’s feedback statement.
He said the addition of basic advice in the recent RDR consultation paper may have been influenced by the Treasury. Last week’s Treasury White Paper on reforming financial markets highlighted the need for consumers to be able to access simple transparent products.
In last month’s consultation paper, the FSA proposed that restricted advice would include both simplified advice and basic advice.
Simplified advice refers to advised guided sales that provide the consumer with a suitable personal recommendation based on an assessment of their needs, and would include current single-tie and multi-tie models.
Basic advice will be regulated advice which firms can use to sell stakeholder savings and investment products. It will include a streamlined sales process and pre-scripted questions without a full assessment of needs.
Williams said: “There is no need for both. Let’s not overcomplicate things, let’s build one road moving forward.”
Barclays Financial Planning products director David Stuart said while the independent brand is respected by consumers, the other labels will only cause confusion.
He said: “The IFA brand has been successfully marketed but I do not think the lower brands will help the industry. It is more helpful to explain to consumers what they can offer them but labels just confuse consumers.”