The £25 fee will initially be halved in February before being stopped in October 2009.
However, Cazier says the move is “extremely disappointing” given that most firms’ would already be carrying that admin out at a loss.
He says: “It is sad that they have come to this decision without even consulting us. This fee is paid to Cofunds part-owner IFDS and will cost us a material sum of money.”
Schroders managing director of UK retail Robin Stoakley says: “What this does is lower the margins for fund firms while increasing Cofunds. It is not the best piece of information that has come across my desk.”
Cofunds marketing and propositions director Alastair Conway says: “The cost should not fall onto the IFAs lap given that two-thirds of fund firms do not charge the fee already. What this does is allow fund management group’s and third party distributors to review their admin and make it more efficient.
“We have subsidised this for some time, unlike many of our peers, and the move is not margin based in any shape or form, but more of allowing for efficiency issues to be reviewed.”