Earlier this month, Apfa announced it would merge with the Wealth Management Association. As a deal, it will certainly create a more sizeable operation with a larger budget. But where exactly does it leave advisers?
The biggest challenge about to emerge from the FCA is going to be a pressure on prices: the price of wealth management, the price of platforms and the price of advice.
This new merged body – to be called the Personal Investment Management and Financial Advice Association – will sit in two of the areas the regulator is focusing on.
Is it going to represent the 80 per cent membership of wealth managers, or will it speak up for the newly acquired Apfa members that will account for just 20 per cent? It cannot do both, so it looks like the adviser’s voice will be compromised.
In 2012, Apfa had a turnover of £1.2m. Last year, that figure had dropped to just £566,802. With income having halved in just five years, a merger was inevitable.
Is it going to represent the 80 per cent membership of wealth managers, or will it speak up for the newly acquired Apfa members that will account for just 20 per cent?
If we are going to change the advisers’ lot and expand our profession, we need a focused, fit-for-purpose, properly funded trade association. The bill is £3.5m per annum. Doable, as it was the real terms spend advisers had in 1999 with Apfa’s forerunners.
Indeed, this is nothing to do with affordability. Only will and pride. Advisers generate over £6.5bn pa. If they all committed just £1 in every £2,000 of income, or £100 per adviser, or 1 per cent of their regulatory invoices to a trade association, this would be achievable.
The target is peanuts but is there the will? This is not about squabbling trade bodies. It is about the future of advice.
Garry Heath is director general of Libertatem