When the new single trade body for IFAs was set up last September, its
dream was to give the community a united voice. So how does director
general Paul Smee respond to criticism that it cannot hope to represent the
views both of small and big IFA firms? 'If you like what it is doing 80 per
cent of the time and only disagree with its stance 20 per cent of the time,
this should be good enough,' he tells Joanne O'Connell
Are you the odd one out at parties? Is telling people you are an IFA a
conversation stopper? Do people whisper about pension misselling behind
For IFAs who feel nobody understands them, help is at hand. Association of
Independent Financial Advisers director general Paul Smee says IFAs can
join forces through trade bodies, be kept up to date on relevant issues and
be part of an organisation which lobbies on their behalf.
Launched last September, Aifa was set up with the int ention of giving
IFAs a uni ted voice.
Smee says: “Joining a trade body is the only way for IFAs' voices to be
heard. Aifa was set up to represent the interests of all IFAs from sole
traders to large firms.”
However, Aifa has been given a mixed reception by IFAs. The trade body has
not hit the spot for some IFAs who say its lobbying is ineffectual, that it
does little to raise the plight of IFAs and its fees do not offer value for
The Analysts director Tom Kean says: “I want a trade body to lobby on my
behalf and shout the views of IFAs from the rooftops but Aifa seems
ineffectual at lobbying, does not get our message across and its fees are
expensive. You can bet your bottom dollar most people do not know about the
plight of IFAs.”
Bateman Group senior consultant Ian Smith says: “IFAs do need a good,
single IFA organisation to speak out for us but we have not got one so
However, Aifa also has strong supporters, with some IFAs saying they have
been waiting for this type of trade body for a long time.
They believe Aifa will achieve results precisely because it is not as
confrontational as previous representative organisations.
Lambourn Buckingham partner Susie Footit says: “It is about time we had a
trade body like Aifa. It is quick to respond to issues at the forefront of
Aifa's recent move to secure the membership of the UK's biggest
high-street IFA, Bradford & Bingley, sees it representing 60 per cent of
Smee says Aifa provides several services for IFAs. These include a focal
point for press comment and Government contact and disseminating
information on industry issues so IFAs can identify trends which may affect
them ahead of time.
Aifa has 13,500 regist ered individuals from more than 5,000 firms and
Smee says it has the membership of sole traders as well as big firms.
However, some IFAs from big firms say there is no need to join Aifa as
they can stand alone while small IFA firms say they have found other ways
to get their voices heard.
Hargreaves Lansdown chairman Stephen Lansdown says: “I am not a member of
Aifa as it would be a waste of time. We are a big company so we are large
enough to stand on our own two feet. If we joined Aifa, we would be paying
money for nothing.”
Informed Choice managing director Nick Bamford says: “I am not a member of
Aifa and do not need it to put across my views. I am fortunate enough to be
able to speak to journalists regularly in both the national and trade press
so I have a different channel to air my views.”
Some IFAs say Aifa membership fees are too high and the charging structure
puts them off.
Wentworth Rose managing director Philip Rose says: “We have been tempted
to join Aifa but we think the charging structure is problematic. If you
want to join Aifa, you have to pay a company fee and then pay another fee
for each member of your firm who wants to join as a registered individual
so our firm would have to pay four times over. Why should we do that when
Aifa will not go to four times more trouble on our behalf as a result?”
However, Aifa is worth the expense as far as Chadwicks director Richard
Ross is concerned.
He says: “I think Aifa is doing a tremendous job. It is actually doing
things on a practical level which makes IFAs' jobs easier. For example,
offering meeting rooms in London at good rates for IFAs to meet their
clients is useful. I receive email every two to three weeks keeping me up
to date on industry issues. Aifa not only lobbies on your behalf but also
lets you know it is lobbying on your behalf.”
It is lobbying which is seen by IFAs as a primary func tion of trade
bodies and they say this is where Aifa falls down as it does not seem to
shout loudly enough.
But IFAs admit it is difficult for any one trade body to represent such a
diverse range of views, ranging from sole traders to big companies.
However, they are not happy to be a member of an organisation which may
not voice their individual opin ions on industry issues.
Bamford says: “A joint voice is a great strength but it is also a
weakness. There can be common ground among IFAs but there is also a range
of different views. When you sign up to a trade body, they have to
represent all their members but speak with one voice. I do not want a trade
body like Aifa to purport to represent me, the IFA, if they do not support
my views 100 per cent.”
Kean says signing up to a trade body is like being part of a political
party, as it must represent the views of the majority. He says: “Like in
any democracy, you have to toe the line. Trade bodies have to take the
views of the majority of their members.”
But Smee says he always answers IFAs who are concerned about the majority
view swamping their individual voice by saying it is the same in any
collective and they have to be realistic.
Smee says: “I always say to remember the 80/20 rule. If you like what Aifa
is saying 80 per cent of the time and only disagree with its stance 20 per
cent of the time, this should be good enough. As an individual member of a
collective group, you cannot expect to like everything Aifa says 100 per
cent of the time. But we do try to make sure everyone is happy 80 per cent
of the time.”