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Nic Cicutti: When did advisers lose their political mojo?

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One of the more interesting things about the internet is that it encourages promiscuity. By that I don’t mean a desire to swap sexual partners but the tendency on the part of information-hungry citizens to forage more widely for the intelligence they need.

For regular Money Marketing readers, loyal as they undoubtedly are to this paper and website, it implies a willingness to interact with each other not just in its news and features pages but on other forums and sites.

That is what makes the internet such a brilliant tool, updating and cross-pollinating continually, allowing for a far wider interaction between IFAs, who flit from one site to another to debate and discuss.

Which is why I hope the editor of Money Marketing won’t mind me mentioning a blog by Daniel Grote on a rival website about the problems the adviser community has in lobbying politicians. 

Grote recently wrote a brief article mentioning he had met Reading-based IFA Clive Smith in the House of Parliament in relation to the IFA Centre’s briefing of MPs over the Arch cru debacle.

Smith, for those who are unaware, was president of the LIA in the mid-90s, when the trade body had an enviable reputation as an influencer of MPs and regulators, largely thanks to the efforts of its sadly-departed public affairs head John Ellis.

Back then, he told Grote, he spent a goodly proportion of his time “in the corridors of Westminster” talking up the profession and giving Members of Parliament chapter and verse about the LIA’s views.

Today, all that appears to have changed. Grote quoted the IFA Centre’s managing director Gill Cardy as speaking openly “of the difficulties she has encountered in building up membership of her fledgling organisation. Without financial support from advisers, effective lobbying on their behalf is impossible”.

Across London in Throgmorton Street, the new Association of Professional Financial Advisers does not so far appear to have resurrected its fortunes by opening its doors to all and sundry in the wake of its membership review last year.

I recently had coffee with an MP who has long had an association with financial issues. I’ve known this person since the early 1990s and he retains a strong interest in personal finance matters, talks knowledgeably about the RDR and independent advice, which he remains strongly supportive of “conceptually” – that’s his word by the way.

He remembers being lobbied by the LIA and also meeting representatives from Nfifa back in the day when they too sought to influence MPs. Today, however, he says he simply wouldn’t bother. Nor, he says, would most of his Commons contemporaries who, like him, retain some interest in the world of finance.

In fairness, this may be as much because the political priorities of this MP and his colleagues have changed over the years. But it also reflects, in the opinion of my contact at least, a disenchantment on the part of legislators with IFAs whom they feel have not lived up to expectations of their role in society.

By that, my informant does not mean to infer IFAs do a bad job on behalf of their clients. No, what concerns this MP is that once upon a time he saw IFAs as a potential bulwark against the depredations of banks and life company salespeople against consumers. IFAs, he hoped, would speak with one voice in support of a financially bruised and battered public, acting as their champions.

But over the years he has come to realise that IFAs’ own ambitions with respect to their clients and the industry generally are far more meagre and less ambitious. When it comes to lobbying, the interests they represent are primarily their own and not the wider community. In turn, this MP has lost interest in hearing what IFAs have to say.

OK, so these were just one MP’s views and maybe they were not representative of his peers. But somehow I can’t help feeling that they did reflect something more than disillusionment after decades as an MP, constantly bombarded by lobbyists of all stripes and persuasions.

And it also occurs to me that back then, what shone through in the lobbying efforts of people like John Ellis was an attempt to constantly align the interests of the LIA with those of the wider public – for example in his long-cherished commitment to greater professionalism for IFAs, including compulsory examinations for the industry.

Until IFAs and their current representatives can demonstrate similar alignment on issues relevant to consumers today, I fear the absence of advisers from the wider debate about finance and the relegation of their views to trade-only websites and forums will continue.

Nic Cicutti can be contacted at nic@inspiredmoney.co.uk

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Comments

There are 23 comments at the moment, we would love to hear your opinion too.

  1. Richard Bishop 6th June 2013 at 9:55 am

    Zzzzzzzzzzzz

  2. @ Richard Bishop
    We are in agreement Richard.

  3. Maybe if Gill closes her small advisers body and enjoins with APFA such a target will be achievable

  4. What a load of rambling nonsense.

    Apart from not having the spare time for lobbying, what’s the point?? The Regulator is not accountable to Parliament and it is impossible to effectively counter ill-informed journalists hell bent on ensuring that the vast majority of hard working advisers are painted as money-grabbing sheisters.

    Brief rant over.

  5. Peter Heffernan 6th June 2013 at 12:13 pm

    Heard the one about an MP who got his wife to admit to speeding, or another MP who, with another 3 or 4 peers was caught accepting a bung for asking questions, or, well I could go on.
    If you consider the times that MPs have been bombarded with requests for a long stop, or a judicial review of the RDR or indeed their ineffectual handling of dear old Hector Pants at the treasury select committee is it any wonder that we don’t bother with these”people” .In my opinion they are down there with dodgy car sales men, CMCs and overpaid journos who drag anything up just to fill column inches

  6. RegulatorSaurusRex 6th June 2013 at 12:16 pm

    We are not inspired

  7. Those that can do those that cant lobby.

    Advisers are way too busy trying to do their best for clients to spend time lobbying their MP.

    Even if they did the TSC is toothless when it comes to dealing with the FSA/FCA.

  8. “But it also reflects, in the opinion of my contact at least, a disenchantment on the part of legislators with IFAs whom they feel have not lived up to expectations of their role in society.”

    No it’s the other way round Nic.

    I and many other IFAs contributed to the TSC a paper on RDR. To the best of my knowledge there were few concessions obtained (especially in the area of grandfathering which has resulted in the loss of many perfectly good IFAs) by MPs who may well have been sympathetic, largely because, as Andy Jones says above,the FSA was not accountable and the IFA community and indeed the TSC were effectively told to get stuffed.

    Like other chunks of the populace I would imagine most IFAs feel disenfranchised and that it is pointless to get involved politically.

  9. ‘IFAs have not lived up to expectations’

    that’s a bit rich coming from an MP !!

    Blair’s absolutely right MPs have not lived up to expectations in ANY respect !

    Hey listen Nic I wont be at all smug when this all goes pear-shaped and is seen precisely for what it is – you watch your MP mate and his mates run for cover then !

    By the way next train wreck is MMR you seen it coming yet ? thought not !

  10. Totally disenfranchised 6th June 2013 at 1:08 pm

    Perhaps IFAs’ are not able to offer a big enough bung.

  11. Good grief!

    I normally have empathy with much of what Nic writes, but this! I’m almost speechless. (But I did say almost!).

    From what he says he places faith and credence in MPs and Westminster in general. Well that is fine if that’s what he believes. For me I would put them a long way below double glazing salesmen and payday lenders. Yes there may be one or two honest, intelligent members, but in my experience they are as rare as rocking horse manure. Not a day goes past when the self-seeking veniality or the crass stupidity of these 600 people is not amply demonstrated.

    Unless you have a very fat chequebook lobbying these people is about as useful as bashing your head against the wall. In my opinion the only way forward is to be self-reliant and self-sufficient and as far as possible get on with your life as if these people didn’t exist. Sometimes you may have to swallow bile, but very often you can get by with ducking and weaving. Let Amazon, Google, Starbucks, Apple etc. be your example. Follow the rules and use the loopholes open to you.

    So whilst there may be disenchantment on the part of legislators with IFAs, it is as nothing compared to my disenchantment of them.
    I can only speak for myself, but as I have said on so many occasions I am not a social worker nor do I attempt to speak on behalf of the financially bruised and battered public or act as their champion. I am only interested in the best interests of my own clients and acting as their champion and doing my absolute best for their financial welfare.

  12. No one listens Nic,they gave up years ago as the numbers of IFA’s,tied advisers and life consultants (often the backbone of the LIA locally) fell and fell as regulation increased.There are so few now we are of no importance politically and sadly the providers are abandoning the sector as well.The regulators are dictators and are no interested in dialogue and are unaccountable QUANGO anyway. Your MP friend seems to be out of touch with the changes since the 90’s The advice landscape has changed beyond all recognition,the banks are no longer involved ,Allied Dunbar,now SJP are untouchable and IFA’s are no lolonger mass market. Effectively they have all but regulated the problem away now,UCIS will soon be gone and SIPP providers are clamping down on pension liberation on their own as the FCA are washing heir hands. Why not get your political chums to an IFA forum for a chat so the can get up to speed,or is that too much to ask of a journalist?Better still just e-mail the responses on here to your article!

  13. Totally disenfrachised 6th June 2013 at 2:37 pm

    @ Harry
    “In my opinion the only way forward is to be self-reliant and self-sufficient and as far as possible get on with your life as if these people didn’t exist”
    could not agree more Harry.This is the only way to live. If you expect a politician to do anything to improve your lot or you believe you are part of the BIG society, whatever that may be or even that “we are all in this together” then you are a complete mug.
    Just do your job to the best of your ability and get on with your own life. The rest, including politicians who are supposed to represent ALL of us, including IFAs’, can do as they please. I simply do not give a toss.What would be the point?

  14. Where do I start Nic!

    IFAA ran a fully involved parliamentary campaign for years which was regularly coordinated with the Consumer Association as we found we were more in sympathy with CA than the industry on a number of issues particularly polarisation.

    We had over 400 MPs “on a take a call” status with 120 far more involved with that. So successful was this that your chums in New Labour objected to this use of Parliament. Far too democratic

    The Treasury and that doyenne of all that is decent; Patricia Hewitt entered a conspiracy with the ABI to interfere with the representation of the IFA sector.

    The ABI funded the AIFA on the basis that Parliament would not be lobbied as they had agreed it with the Treasury.

    Within 6 months polarisation had gone, and now we see RDR and the attempted removal of the Independent from an political and commercial power in the market.

    The power of IFA representation is based on the renamed version of the discredited AIFA which has less income than IFAA had 15 years ago and whatever Gill does on her kitchen table.

    You are a journalist – or you were – how about getting the record straight and really research what went on in 1999 – Freedom on information etc.

    Lets find out what really happened

    G

  15. Richard Bishop 6th June 2013 at 4:23 pm

    We did lobby MPs and they agreed the RDR should be delayed.

    No point when the FCA has the final word.

  16. totally disenfranchised 6th June 2013 at 4:54 pm

    When the fsa told the TSC to get stuffed

  17. I agree with the consensus. Nic for years has just been a gutter reporter, winding up the IFA for easy money and not reporting constructively on issues affecting the industry or consumer alike.

  18. A Man With Three Buttocks 6th June 2013 at 7:46 pm

    If only APFA would up its game and start lobbying MP’s and, by way of Lord Deben, members of the Upper House, instead of the regulator, we might start to see some progress.

  19. Tsc to Hector – We think k you should delay the RDR by one year.

    Hector to TSC – Get stuffed.

    Parliament to Hector – Well done for proving you are Independent (of MPs perhaps but not the Treasury), here have a Knighthood. Arise Sir Hector the “undeserved”

  20. There is no political will to shackle the regulators and expose their industry ambitions as unfeasible.

    Frankly, even if there was, the drafting of FSMA enables the FCA, or regulator of the day, to ignore any request, suggestion or counter argument.

    In short, until FSMA is amended or until a new regulator with restricted powers in in place, the idea that we can overly influence anything is misguided.

  21. Somersets Finest 7th June 2013 at 3:33 pm

    Is it just me or was the whole point of that article for Nic to say that he had coffee with an MP?

    MP’s are self satisfying, scamming, narcissistic and stupid people (on the whole) so what is the point in lobbying on serious matters when they are too busy getting their pigeon loft refurbished on expenses (or whatever it is these fools do).

    I think that in desperation for column inches this loyal MM fan-base Nic speaks off are in danger of calling a mutiny……both of them.

  22. There will be an absence of Advisers from the wider debate because there won’t be many left who can afford the cost and time constraints of regulation to remain in business.

  23. Just got back from holiday:

    @Garry Heath: Yes, you had a very effective lobbying machine. The CA did support IFAs on polarisation, as did every serious financial journalist. But now they don’t really care any more. Why is that? As for the FoI idea, good one: maybe MM will pick up on it.

    @Richard Bishop: I suppose that’s better than you calling me a cu*t and threatening me with physical violence because of something I said. Baby steps, eh?

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