Apfa has written to Chancellor George Osborne demanding the Government targets the FCA as part of a drive to improve regulation.
Business secretary Sajid Javid promised the Government would seek to cut £10bn worth of red tape shortly after the election.
However, advisers responded sceptically to the announcement, and now Apfa is calling on Osborne to makes sure FCA’s work is scrutinised.
In the letter, Apfa director general Chris Hannant says it is unclear why the financial services sector has yet to be subject to initiatives like the red tape challenge during the last Parliament.
He says: “Although we understand that regulatory action was required in the wake of the financial crash, the financial advice sector is struggling under the current regulatory burden and with a regulator that appears unable to abide by the same budgetary principles it applies to those it regulates.
“Other industries which come under the purview of an independent regulator, such as energy and water, have been part of the red tape challenge, for instance, and we fail to see why this should not be the case with the finance sector.
“Considering the recent changes to the pensions and savings landscape, anything that discourages consumers from access to professional financial help should be of the utmost concern to the Government.”
In particular, Hannant calls on the Treasury to place a duty on the FCA to consider economic growth and the impact of its work on the contribution of financial services to the UK’s GDP.
He says: “We believe that not having such a duty led the FCA’s predecessor, the FSA, to develop policies in isolation, without considering the full impact on the industry; for instance, adviser numbers have fallen by nearly 15 per cent since the implementation of the RDR.”
The FCA should further be required to publish a “regulatory scorecard” to show its progress, he adds, noting that the financial services watchdog should also seek to make greater progress in cutting the existing regulatory stock, with a target of the FCA’s handbook being reduced by a third in length over two years.
Hannant says: “At a time when more people need to engage with financial services, as the long-term care and pension reforms take effect, it is more important than ever that the regulator is not a barrier to consumers doing so.”