September is the busiest month of this year for both the Personal Finance Society and me personally.
The month kicked off with the first of five autumn roadshows, where myself and some of the PFS team are talking to members and non-members about how we operate, what we are doing now and what the future holds for all of us. More important, there is plenty of time for the attendees to ask questions. The first two in Birmingham and Leeds highlighted what has become a recurring theme. Understanding the role of an FSA-accredited body and how to obtain a statement of professional standing are top of the questions coming from the floor, although closely followed by questions relating to the new rules that firms have to adhere to if they want to call themselves independent.
The other popular topic is the application of VAT to adviser remuneration, which was increasingly looking like a Pandora’s box waiting to be opened. The good news here is that HM Revenue and Customs has now confirmed that guidance will be issued for consultation next month and, all being well, we should have it confirmed very early next year. The hope is this will enable firms to decide on their service proposition and method of remuneration with more confidence about what is and is not subject to VAT.
The PFS conference held earlier this month to explore the new rules relating to independent and restricted advice caused quite a stir. This coincided with the release of our professional direction paper, which aims to provide clarity on the new rules. Much of the content of the paper and our conference has been covered in the trade press. The initial headlines were over the FSA speaker’s comment that to be independent, advisers should not rule out non-UK products. This created a furore of comments, some rather extreme, about having to recommend products from the entire world.
Realistically though, what is new? Advisers have been recommending offshore products where they are appropriate for clients for as long as I can remember. The UK regulatory system, combined with the FSCS and FOS, provides consumers with probably the best protection in the world so unless there is a clear reason to advise clients on products outside of that protection, why would you expose them to the additional risk without good cause?
We hope our paper has helped provide a better understanding but it cannot cover every possible scenario and I expect further examples to emerge from the FSA over time as it produces its RDR newsletter and Faqs.
We are all on a learning curve and must continue to work together to take the profession forward. The appetite is there, as shown by the record numbers attending PFS events. And it is not all doom and gloom, the majority of members I am meeting as I tour the country are positive and upbeat about the future.
Fay Goddard is chief executive of the Personal Finance Society