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Too little attention in the RDR debate has been focused on the consumer. Ultimately, there is a need to look back at the RDR and its core objectives. There is a need to make sure that we get a better and not just different outcome from this review. There must be a recognition that consumers share responsibility. We, as IFAs, have a unique level of access to consumers’ wants and needs.

We are preparing our response on behalf of the IFA profession and want to see an informed discussion of the regulator’s proposals and hope to respond with a united voice, helping to shape the future of our industry to meet needs and wants of the IFA profession and the end-user. We must not forget the consumer is central to this work, and ensure any changes make a positive impact and increase their access to good advice. Otherwise the consumer will see this whole process as a waste of time. Our consumer research clearly shows the mismatch between consumer needs and wants and the potential outcomes of the RDR. While we want to see consumers better informed simply dumbing down advice and making more simplistic advice available is not the answer. The research we carried out with YouGov shows that the term independent in reference to IFAs is a recognised commodity. When all adults who have received advice from a professional financial advisor were asked about the key features of an IFA 75 per cent of them expect them to be able to search the whole of the market for a product that meets their needs. Only 31 per cent thought independence had any bearing on their payment options yet, under the latest proposals, firms may only be allowed to call themselves independent if they operate on a fee basis, or adopt the consumer-agreed remuneration system. Those firms which dealt with clients by commission would not be allowed to call themselves independent and unless all current IFA firms move to fees or CAR, fewer consumers may be able to access independent advice.

We do not want the industry to return to buyer beware. When we are trying to build consumer trust this would be a disaster. Consumers must engage with the industry and contin-ually make more informed and educated decisions about their finances. How can this be possible if we remove expert whole of market advice? It would not.

People from all walks of life and all ages seek out advice and over half of those who took part in our YouGov survey have received advice from a professional financial adviser. Four out of 10 were from lowerincome backgrounds, which flies in the face of advice being a preserve of the rich and educated. Over half who received advice were between the ages 18 and 34. This is encouraging and we need to ensure the RDR serves to increase the numbers seeking out professional advice, not reducing it and replacing it with a poor and simple alternative. What is most important is that consumers understand the nature and cost of the service that is being offered and that they can trust the advice they are being given. We have questioned whether the RDR will deliver this desired outcome.

Our detailed research programme is now complete and we are analysing all the data together with all the feedback we have received from IFAs who have filled out our online RDR survey.

We are now formulating our response, as the December deadline draws ever nearer, make no mistake, we may be approaching the final hurdle, but it is only the first race. The next one begins early in 2008, when AIFA will press ahead with behind the scenes lobbing of FSA and Treasury. We look forward to the FSA producing their initial findings in 2008.

The RDR provides a great opportunity to deliver a better outcome for consumers. But we, as main providers of advice and services, need to shape the new policies.

Chris Cummings is director general of Aifa


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