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All-party MPs attack plan to axe polarisation

Government backbenchers and the Opposition have attacked the FSA&#39s plans to scrap polarisation, warning it will restrict independent advice to the rich and reduce the viability of IFA sector.

The Conservatives say the possibility of misselling would be greatly increased and that IFAs could effectively disappear.

Labour backbencher and member of the Treasury select committee Jim Cousins says sophisticated advisers will not be damaged by the changes but the majority of consumers will not understand them and will be less likely to save.

Shadow paymaster general Howard Flight questions the need for Ron Sandler&#39s review to continue, saying that all the material he is looking at has already been covered by the FSA.

Cousins says: “The mass market will be totally befuddled by this. These proposals may well muddy the waters, we need a lot more work on them.”

Liberal Democrat trade and industry spokesman Vincent Cable says: “I regret the end of polarisation. It appears to end the position of the genuine IFA who wants to offer products from the entire market. The proposed changes will only serve to confuse the market.”

Tory backbencher John Butterfill says: “I was dismayed and appalled at the suggestion from Howard Davies that IFAs are effectively going to disappear.

“The dark forces within the Treasury which have always been in bed with the big banks have won the day.”

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