Apfa is calling for regulatory budgets to be frozen and reporting requirements slashed as part of a package of reforms designed to dramatically cut advisers’ costs.
The trade body’s ‘Manifesto for Advice’, published today, urges the FCA to lower the cost of complying with its rules without reducing protections given to consumers.
It says this can be achieved by lowering adviser reporting requirements, freezing regulatory bodies’ budgets in nominal terms for three years, and cutting the length of the FCA’s handbook by a third.
Apfa also renews calls for an advice liability long-stop to be introduced in the UK.
It says: “The current framework creates significant problems regarding the liabilities advisers face and the compensation costs, as demonstrated, for instance, by the availability of professional indemnity insurance. In recent years a number of providers have exited the market and prices have increased, exclusions widened and excesses increased.
“Specifically, the advice community has concerns about the way in which the Financial Ombudsman Service handles complaints – we recognise the need for a dispute resolution service for consumers, but advisers need to have confidence in the way complaints are handled.
“Another problem is the lack of a limit on the length of time during which a complaint can be brought – the lack of a “longstop”. These uncertainties around liability deter investment, which has a knock-on impact on the ability of the profession to attract funds for expansion and, thus, the capacity to provide broader consumer access.”
Apfa also wants the Government to extend its ‘Red Tape’ challenge to the FCA and ensure a “stable policy environment for pensions”.
Apfa director general Chris Hannant says: “Policymakers must do their part, not least by ensuring a stable environment and a reduced regulatory burden to help bring down costs and give the room for the financial advice industry to innovate. There is an onus on the industry itself too, and it must do its part by innovating and bringing new, lower cost services to market which better suit the needs of customers today and in the future.”