Sheltering my sunset-blond complexion in a blacked-out Cretan hotel room as my two-year-old snuffles gently through her siesta, Her Majesty’s financial services industry seems light years away. But my concerns about conjuring up a suitable column for you last all of three seconds as the first story I read on the adviser newswires back home informs me the IFA is “doomed”.
Oh thank you, Lord Newby. May heaven bless you and rain fragrant flower petals down on your charmingly antiquated inclination to tell journalists what you really think and your equally naïve failure to realise that, now you are a Treasury spokesman and an actual part of the coalition Government, it does rather matter what you say. Even if you are a Liberal Democrat.
Newby was responding to a question, put to him at a fringe event at the Liberal Democrat conference by a reporter from this very parish, on the role that IFAs might have in the future of financial services. I wasn’t present – what with being in Crete and everything – but, judging from the reports, his lordship did not actually say the IFA was “a doomed species”, the modern need to encourage online readers to click on to news stories having done little to encourage measured or indeed wholly accurate headlines.
No, to be fair – and I promise I won’t make a habit of it – what Newby actually suggested was that the “traditional” sort of IFA seemed to him to be a doomed species, adding: “I think there will be a drift away from old-fashioned financial advice.”
Well, yes – no arguments there. That is, after all, rather the point of something called the retail distribution review.
Except it turns out the LibDem version of Private Fraser from Dad’s Army is not talking about the RDR at all – no, it’s just that, with the regulatory requirements and costs of giving advice being so great, he could not “imagine why anyone would want to do it. It just looks to me really, really hard.”
Don’t get him wrong – financial advice itself isn’t doomed. Looking to the future, as all good statesmen should, Lord Newbs expects his children’s generation will seek advice online rather than go through “the appalling business” of real-life advisers spending time trying to work out what is best for their clients. (Or, if this were a national newspaper, “advisers trying to find excuses to flog rip-off products”.) Anyway, his Lordship hoped people would take financial advice but expected they would want it free and delivered electronically.
I’m not sure what makes me most depressed about the Newby worldview.
Trying, and apparently failing, to duck the easy line about it taking a doomed species to know a doomed species, I would instead stress he is a member of a Government that is about to embark on one of the great cost-cutting exercises in this country’s history – and a Treasury spokesman to boot. So the idea he is put off by things that are really, really hard is really, really worrying.
Then there is his belief the next generation will expect financial advice that is free and delivered electronically.
Yes, I know there are scientists beavering away in the basements of networks and platforms to create software to do precisely the latter but they’ve been doing so for at least a decade now – and I’m betting a major hold-up relates to one of the fundamental realities of computing – put rubbish in, get rubbish out. As for advice being free, two words – monkeys, peanuts. Two more words – lawyers, accountants. Who will volunteer to break that piece of news to them? Not me.
Saddest of all, perhaps, is that here we have a member of the Government who seems prepared to countenance the possibility financial advice might have some vague point to it – at least he doesn’t lay into the idea, which these days is about all advisers can hope for from those in power – and yet he is also willing to accept that what will kill it off is excessive bureaucracy.
I did mention he was a Treasury spokesman, didn’t I? Someone who could actually make a difference? It just looks to me really, really hard…both to believe and to stomach.
Julian Marr is editorial director of www.marketing-hub.co.uk and www. thoughtleadershiplive.com