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IFP calls for FSA to limit RDR costs

The Institute of Financial Planning has called for the FSA to commit to “tight control” of its own costs, and to limit the expense of RDR proposals for firms.

In its response to the latest RDR consultation paper, the IFP says small firms have already faced significant cost increases, and will have to shoulder even more in the lead up to 2012.

It states: “We would urge the FSA to acknowledge that fact, and to commit to keeping a tight control both on its own costs, which fall indirectly on firms, and the direct costs of these reforms.”

The IFP also says the FSA should take a less intrusive approach to remuneration within individual firms.

It says: “It does need to be recognised that achievement requires reward and we are concerned that the regulator should not unduly interfere with firms internal remuneration policies. We note that many other professions, accounting and law in particular, have individual remuneration strategies similar to many financial adviser and planning firms.

“We also note that moving advisers onto a salary structure for example is a potential financial burden to the business that might have to be staggered over a period of time to meet revenue inflow changes.”

The IFP says while it broadly supports the RDR proposals, it remains concerned that the focus is predominantly on products and distribution.

It says: “It is not positioned to be concerned with advice, which not only adds value for consumers but will ultimately be the reason why consumers take action.”

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  1. So the The Institute of Financial Planning would urge the FSA to commit to keeping control both on its own costs, which fall indirectly on firms, and the direct costs of these reforms.

    Chee thanks IFP, that will go a long way!

    You mean no more parties on HMS Belfast, no more additions to their fine art collection, no more £500 taxi fares, no more £20m bonus …Oh hang on that was well before RDR and their planned £430 million one off and £40 million annual RDR costing. Add to that in excess of 2 million orphaned clients, 10,000 unemployed IFA’s and the 20,000 unemployed support staff!

    The FSA is a bureaucracy, that eats money and excretes regulation, but not until recently on the door of the banks. It will defend its expenditure status quo long past the time when the quo has lost its status. It hasn’t figured out who will pay its fees when there is no one left to pay its fees!

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