A 15-year long-stop for financial advisers is a “red herring” in the debate about how to widen access to advice, according to FCA Consumer Panel chair Sue Lewis.
Lewis made the remarks when speaking to BBC Radio 4’s Money Box about the Government’s Financial Advice Market Review.
The review was formally launched last week and aims to improve access to advice. As part of the review the FCA is consulting on whether to introduce a 15-year limit on claims against advisers.
Asked whether the long-stop could help to address the advice gap, Lewis said: “The long-stop is actually a little bit of a red herring. [The ability to complain] needs to be there because of the long term nature of some products. There may be other ways of pooling the liability but it needs to be there.”
Personal Finance Society chief executive Keith Richards, also speaking on the programme, said: “Advisers are the only profession which carry unlimited liability for their advice.
“There is no question that the long-stop should be brought back in. The law was changed when lots of 25-year endowments and whole of life policies were sold, so it was done for a fair reason but that now needs to change.”
Lewis argued that simplified advice or simplified products are the key to improving access to advice.
She said: “The trick we’re trying to pull here is to simplify and make advice more accessible and cheaper for consumers with relatively small amounts of money.
“There are a number of ways to go about doing that. You might look at what I think of as the pharmacy model: you can speak to a pharmacist, get some advice and they can sell you a limited range of products.”