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Altmann: Govt has a ‘lack of faith’ in IFAs

Ros Altmann

Former pensions minister Ros Altmann has said that the government is reluctant to make sure people get financial advice because of a “lack of faith in advisers”.

Speaking at Money Marketing’s In Focus conference on pensions and investments this morning, Altmannn said that advisers had been unfairly tarnished by rogues in the profession.

She said: “There’s a reluctance to mandate financial advice because there’s a lack of faith in financial advisers. That is the bottom line. Although the attitude is better, I think underneath it all the government would be worried that people would end up with rogue advisers and come back and complain.

“There are rogues in every industry, in every profession, but that’s not the norm to tarnish the profession with that. I think its wrong.”

Altmann said that the Financial Advice Market Review’s recommendation that consumers should be able to withdraw £500 from their pension early to pay for advice was a “big step forward” but issues like insistent clients had caused government scepticism.

She said: “Do I see the government mandating advice? They were going to mandate for secondary annuity, they have mandated it for defined benefit to defined contribution transfers, so they are some precedents, but even that got tremendous opposition. There were lots of wobbles around the piece, partly because of the insistent client issue. There were lots of people who were mandated to take advice who could not find an adviser to help them and that didn’t help the whole mandatory advice environment.”

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Comments

There are 21 comments at the moment, we would love to hear your opinion too.

  1. I wonder if Government trusts advisers more or less than advises trust Government?

  2. “lack of faith in advisers” well at least we can say the feeling is mutual !

  3. Does anyone know how many regulated advisers have the necessary FCA permissions and PI cover in place to advise on ‘safeguarded benefits’?
    I suspect that this number is very low, and hence why ‘people could not find (a qualified) adviser’.

  4. This should be spun in a different way to; the FCA are not catching the rogues quickly enough and this is effecting the industry for decent advisers and businesses.
    Altmann & Webb seem to be getting behind protectionist policy right now and spinning it to advisors that it’s apparently to protect the consumer from scammers etc.
    Latest ploy is the possibility of a cold calling ban killing marketing campaigns for alot of decent companies to protect the 1 in 10……
    How about Altman and Webb take the tube to Canary wharf and tell the FCA to visit new or suspicious schemes to make sure they are actually friend or foe and leave decent honest companies alone.
    But I guess with Steve Webb at Royal London protecting their client base, he’s obviously impartial and someone in it for the right reasons.

  5. Gee thanks,, Ros… I have no faith in you either..

  6. Ask the public!

    The public trust Government less than anyone in a professional capacity,

    Would you trust an untrustworthy person to recommend anything?

    Financial advisers have always been represented as “cowboys” because people have been encouraged to question the worth of what they do without knowing what questions to ask or given any guidance on what the value of that advice is.

    The bottom line is that there are untrustworthy cowboys in every profession and every job.

    This holds true in anything, whether you be a politician or a hairdresser or a financial adviser.

    My hairdresser is pretty rubbish but I love him as a person and will put up with the unimaginative haircuts because I want him to earn his crust.

    That said, I haven’t come across many people better at taming my unruly barnet so what can I tell you?

    Ian Coley

  7. Odd how the recent survey of trusted professions put politicians absolute bottom of the pile…

  8. This is news? Nick has put it well. Just look at how many MPs have their financial affairs in chaos and then resort to diddling their expenses.

    I reckon there are more honest advisers than there are honest MPs.

  9. Neil F Liversidge 7th December 2016 at 1:41 pm

    The feeling is mutual.

  10. maybe MP’s should look in the mirror or perhaps they have, and assume that we are all as self serving as they are!

  11. Indeed. Do the Government actually believe that the public have any faith in MPs? Pots and kettles I’d say.

  12. Almost anyone is trusted more than Altman. Our industry has had more changes than any other. Why because of the stupidity of the FCA, the product should regulated not the advice. And who would trust fools like Boris Johnson, who constantly change sides for his own benefits. What a joke.

  13. From my perspective, whilst I agree with the sentiment of many of the comments above about our confidence or faith (or more accurately, our lack of it) in our MP’s, the sad truth is our lack of trust in them makes not a plop in the ocean’s difference, whilst their poisoned and biased opinions of us are highly dangerous to us by way of regulatory drift and policy decisions. My spin would be our trade and professional bodies should be lobbying tirelessly to prove the true value of our professionalism to counteract the one to one feedback Parliament no doubt receives from its so called ‘independent’ agent commonly known as the FCA. Obviously the FCA aren’t going to give a glowing report about us! We are the robbers and they are the cops.

    • Actually John, I do think our opinions of MPs matter as they are often very similar to our clients. In addition, bearing in mind how few MPs actually meet their constituents compared to advisers and how long compared to them, we spend with each client, I am surprised they haven’t realised how much they can influence opinion by influencing those who actually TRUST their adviser. Clients wouldn’t be dealing with us as individuals for DECADES if they didn’t trust our opinions and what we say, even if they don’t agree with it may be influenced.

  14. Really, well knock me down with a feather !

    Is this really news or is it attention seeking from Ros ? come on MM….. this story has only gone live the past few hours and gone past 12 posts already ! Poor old Nic will have to come up with something juicy on Thursday to compete

  15. However mutual the feeling may be she’s right.

    But it’s not just government – it’s everyone. Sorry – but you’ve been tarred with the same brush as the bankers.

    People can see that we have a system where some ‘professionals’ are happy to sail as close the the regulatory and legal wing as possible… and they have no way of differentiating them from those who have some (old school) ethics – and think “fair and not misleading” is the bl**ding obvious basics – not a standard to be aspired to, or work around.

    This is not helped of course be regulators and government who think that they can regulate and legislate bad behaviour away (when they should be working with professional bodies to make such behaviours unacceptable).

    Trustworthy and compliant are not then same thing. You can be the latter without ever being the former – let alone trusted.

  16. A big advantage that scammers have is that what they offer is quick, easy, requires minimal paperwork, no lengthy meetings, no long and involved FactFinding, no questionnaires about ATR and CFL, no questionnaires about Income & Expenditure, no fees, no monster SR’s, no meaningless illustrations and confusing KFD’s ~ the very things with which the regulator has come up to inform and protect consumers against bad advice and to establish suitability.

    I’m not suggesting that all those processes are bad but there are so darned many of them and so many reports of regulatory failures (Connaught, Harlequin, PPI, KeyData, etc) that we can hardly be surprised that so many people have little faith in the effectiveness of regulator and are readily taken in by investment propositions promising great returns whilst at the same time bypassing all the regulatory hoops, hurdles and costs which have so often failed to achieve the very things they we’re designed to.

    How many potential investors ever think to ask questions about a firm’s regulatory permissions, their PII, their capital adequacy or the protections afforded by the FSCS? Most have no awareness of such things and consider them to be nothing more than costly baggage which, in practice, don’t actually achieve anything much at all.

  17. At least IFAs disclose their fees. MPs just put in underhand dodgy claims expenses!

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