I greeted positively the initial news of a prospective merger of the LIA and Sofa. It is a dream – one association to educate, motivate and represent financial advisers.
An EGM to vote on the merger takes place on October 13 so we have little time to form a view. We cannot pick and choose what we like or do not like – we have to decide on the entire proposition.
As a member of the LIA for 27 years and its president in 1988/89, as well as being a Sofa member, I am aware of the good in both organisations.
I have chaired the LIA's education committee. I was a director of SIB for seven years and as chairman of its training and competence panel I was responsible, with many good people, for designing and delivering compulsory standards across the financial services industry. I have spent much of my professional life seeking to enhance standards.
You might think it would therefore be easy for me to support the proposal. It is not.
Before and since the full details emerged, I have been called on by LIA members, members of other organisations and industry figures. Support for a merger has been a consistent theme but many people are concerned that the devil is often in the detail. Many have said this is not a merger and we have got the detail late in the day and now they want a decision in haste.
Plainly, a decision of this importance should not be made on the nod. We owe it to ourselves to examine the detail before voting.
For a society claiming it will represent all financial practitioners, I cannot agree that only those with AFPC be eligible for the board. The LIA has always been an inclusive organisation and, through its regional meetings and workshops, members are encouraged to improve their knowledge.
On its own, this may not be considered by some to be a deal breaker but AFPC will also be the required level to be on the Find an Adviser website. Many good experienced advisers – and the vast majority in a merged organisation – hold the minimum required level plus some additional modules but do not have the full AFPC. It is, of course, a desirable aim but if they specialise in long-term care, mortgages or investment, for example, the AFPC or its equivalent may not be the best course.
This website should surely be changed for the benefit of all regulated, subscription-paying members.
The documents say the new Personal Finance Society will be “within the CII group”, its accounts will be consolidated within the CII accounts and the strategy of the PFS must be approved by the CII council. Additionally, under the articles, “the institute shall have the right to appoint such number of additional non-member directors (employees of the institute) as may be required from time to time so that the non-member directors form the majority of directors”. This appears to contradict written undertakings to members this year that practitioners would be in the majority on the board of the professional body.
Now we learn that the majority could be held by CII employees. We are being asked to approve a major shift from what two LIA presidents thought was important for the LIA and for the PFS – and I agreed with what they said then. In fact, it influenced my own vote in March on the proposal to bring three staff on to the LIA board. It was important to me then and it is important to me now.
This issue of governance is sufficient reason, for those of us who wish to see a single professional body, to think that the lack of independence may reduce the prospect of the Institute of Financial Planning or the Institute of Financial Services joining any move to unity.
The LIA says 69 per cent of members want a merger. I was 100 per cent behind a merger but the percentage dropped on seeing these details.
More time is needed to consider the contentious issues. Indecent haste and apathy may win the day but, for me, that does not make it right.
We are all entitled to our opinions. I still want to see a single body but not, in conscience, on these terms and particularly not in such a hurry.
I know that I have more years behind me than ahead. We need to build for the future but, regrettably, on its published terms, I will be voting against this proposal.
Len Warwick is managing director of Warwick Butchart Associates