View more on these topics

Aifa&#39s View

I did enjoy my holiday but I could have done without a return marred by the continuing Financial Services Compensation Scheme saga. I would also prefer to be able to give a more upbeat assessment of this situation than a comment that discussions with regulator and providers are continuing. But that is where we are at.

I do deplore (good word, for which thanks are due to the Treasury select committee) the tone of some of the FSA comment, when it is clear that the reason for IFAs&#39 inability to meet these unexpected invoices is not budgetary failure but a lethal cocktail of circumstances. I do hope that pragmatism will prevail when push comes to shove and I am grateful for the FSA&#39s offer to talk to providers.

And to think that it was Aifa which actively encouraged the FSA to move its invoice date from July to August so that tax payment dates were avoided. But we are pressing on and will keep our members updated. We certainly are pressing the regulator to demonstrate more understanding towards those IFAs which are genuinely unable to meet these bills in the timeframe expected.

I wish that I could give a firm timetable for resolution of these issues but I can only really make assurances about the priority which we are giving the issue. I will not labour the point. There are other things on the boil although it may not seem like it.

This is the autumn of depolarisation – final rules perhaps in November, a start date in January next year? Who knows? But we are nearing the denouement of a saga which started in January 2002 with CP121. Much water, not to mention blood and sweat, has flowed under the bridge since then. The defined payments system was buried in a pauper&#39s grave, the menu emerged and expanded until it took centre stage.

I reckon that we are approaching the point where businesses can determine how they wish to respond to depolarisation. There is no fixed deadline for deciding this. But six months after the start of depolarisation (by June 2005?), those which wish to retain the independent label must offer advice across the whole of market and the option of being remunerated by fee. If no fee option is offered, then the business cannot call itself independent. Of course, businesses need not rush into deciding on a change of status – the rules are permissive, not mandatory. But there is an immediate need to think through the implications for you and, most important, your clients.

At some point, a wake will be held to mark the passing of a polarised market and I would like to be invited to give the oration. Polarisation has served the consumer well. It has enabled the concept of a community of advisers, independent from providers, to take root. Its demise is to be mourned. It can be credited with putting advice on the map and allowing the idea of a profession of financial advisers to be born.

But it is on the way out and now is the time to adapt the skills learned in the polarised world to the new format. I can only hope that the focus on advice is maintained as I believe that it is in that direction that happy clients and sound businesses lie.

Paul Smee is director general of Aifa

Recommended

Lay blame at the right door

Are you not just fed up of the disproportionate criticism of the IFA sector with: •Misselling, over 80 per cent of which is attributable to the tied sector. •Misinformed criticism of fund-based trail commission. With defined-contribution pension provision in the private sector, how does the Treasury select committee expect the essential ongoing advice to be […]

That&#39s another fine mess…

The compensation scheme&#39s system of payments is in a fine mess. The question is, who got us into it? Is the regulator playing Oliver Hardy to the providers&#39 Stan Laurel? Maybe. The bills for this fatal showdown between IFAs and the FSA over non-payment of their compensation scheme levy have not reached all advisers. Some […]

Success story

Bruce LoveGooding: &#39Women tend to take a more holistic approach to building relationships with clients and providing advice. A lot of research has shown that they are naturally better listeners and provide more considered opinion&#39 Belcher: &#39It is difficult to gain the kind of exposure I have had since winning the award. To be able […]

Cheltenham & Gloucester – Two Year Premium Fixed Rate

Type: Fixed rate mortgage Fixed term: 4.99% Fixed rate: Until September 30, 2006 Minimum loan: £100,000 Maximum loan: Up to 80% of valuation subject to a maximum of £3m Income multiples: Based on affordability calculation and credit score Conditions: Capital repayments of up to 10% a year allowed without penalty Arrangement fee: £499 Redemption fee: […]

Changes to early exit pension charges

In November last year, the FCA announced that from 31 March 2017, early exit pension charges will be capped at 1% for those customers who are eligible to access their retirement savings from age of 55. The rules also state that for new personal pension plans started after that date, or on new increments into […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment

    Close

    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm

    Email: customerservices@moneymarketing.com