The FCA is being urged to fundamentally rethink the rules it imposes on advisers when carrying out pension transfer business.
Apfa says it wants the regulator to consider “radical” reform of transfer value analysis rules so it is easier for advisers to support customers who want to give up guaranteed benefits following the introduction of the retirement freedoms last year.
Apfa says: “We believe that the FCA should take this opportunity to emphasise that the quantum of the TVA should not be the sole determinant of any decision.
“In fact, we believe there is a case for radical reform – or getting rid of entirely – TVA as the most important determinant in retirement saving decision-making.
“While TVA may be relevant where a client is looking for best value and nothing else, in reality for most individuals in the new pensions regime, other priorities will either take precedence or be just as important.
“The financial advice sector is currently struggling under the burden of numerous rules and regulations and removing the TVA requirements would be a good opportunity for the FCA to demonstrate its commitment to more proportionate regulation.”
The comments were made in response to a consultation from the FCA on potential changes to its rules and guidance in light of the pension freedoms.
The adviser trade body is also calling for greater certainty over liabilities for advisers transacting insistent client business, the creation of an independent appeal body for advisers wishing to challenge FOS decisions, and for the playing field between non-advised and advised sales to be levelled.
Currently, non-advised firms are allowed to receive commission from providers on sales, while advisers are not.
Apfa director general Chris Hannant says: “Pensions have undergone an unprecedented level of change over the last few years and the government has made it clear that good financial advice is at the heart of its pension freedoms. It is therefore vital that the FCA updates its rules to protect consumers and give greater certainty to advisers operating in the new pensions reality.”