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Kim North: FCA rebrand is not value for money

Kim North

The Financial Times last week reported that some of the world’s largest consumer products groups are delaying payments to advertising agencies and commodity producers for up to six months, squeezing cash flows and causing alarm at critical points in their supply chains.

Here in the UK some lucky advertising agencies have been paid a combined fee of over £1m to rebrand the FSA to the FCA as unveiled on April Fool’s day earlier this year.

A freedom of information request submitted by Panacea Adviser owner Derek Bradley shows the FCA spent £723,526 on its new website, £40,347.68 on stationery, £48,000 on its “brand identity”, £91,000 developing its “brand guidelines” and £57,000 on registering the new logo and on legal fees to resolve registration issues.

The FCA also spent £101,000 on the design, legal fees and development of the FCA handbook on the new site.

What I don’t understand is that this is a rebrand, not a launch. The brand name changes an S to a C and the content for the website and stationary already existed and was coded. The new FCA website functionality looks and feels very similar to the FSA website.

The FCA says: “Several agencies submitted quotes for the work on both the brand identity and website design and in both instances we chose the agency that offered the best value for money.”

How on earth would you spend £723,526 on a rebrand of an existing website?

The FCA defends the spending by saying its staff, firms, markets and consumers need to understand its new objectives.

I just searched through Google for the FCA objectives. Listed sixth in the listing was the FCA (very expensive) website saying the objectives are the same as most regulators. Why is the search engine optimisation for the FCA so poor in this instance with law firms listing higher than the FCA?

I have worked with dozens of financial services advertising agencies and currently control and update the content of three websites. SEO listing is one of the most important things about any website. Users will click through the first few listings on a Google search page then move on.

On the Money Marketing website there are over a dozen comments on this expenditure making it one of the most commented news stories last week. Comments include “the only things that have changed are the chief executive and the logo”. As Harry Katz says: “The one thing these guys don’t know about financial advice is how to spend less”.

Regulatory fees increase for members whilse many financial services companies are still cutting staff and reducing expenditure due to the economic back ground and the onerous implications of the RDR.

The FCA is bound by The Regulators’ Compliance Code which is a statutory code of practice intended to encourage regulators to achieve their objectives in a way that minimises the burdens on business.

The purpose of the code is to embed a risk-based, proportionate, targeted and flexible approach to regulatory inspection and enforcement among the regulators to which it applies. This approach will ensure that regulators are efficient and effective in their work, without imposing unnecessary burdens on those they regulate.

I remind myself that the FCA money spent with marketing agencies is not the FCA’s own money, it’s ours, the businesses of the industry.

Kim North (kim@techandtech.co.uk) is director of guidetoadvice.co.uk

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Comments

There are 14 comments at the moment, we would love to hear your opinion too.

  1. Soren Lorenson 10th June 2013 at 9:40 am

    When I read the headline I thought I’d just come on here and write something sarcastic like “Really?”.

    BUT, this is a good article and MM needs to run one of these every week until the FCA understands that we are going to watch and hold them to account for every penny of our cash they spend.

    How can you spend close to THREE_QUARTERS OF A MILLION POUNDS on a website and fail to sort out the insult that is Gabriel and ONA?

  2. All of which just goes to show just what a hollow, token sham is the NAO’s oversight of how the regulator spends its budget. All the NAO does is cast an eye over the regulator’s books to make sure they balance and then signs them off as A-OK. It doesn’t actually ask any questions such as Why did you have to spend so much on this or that or anything else, much less challenge those expenditures.

    As for the FCA, like the FSA before it, supposedly being bound by The Statutory Code of Practice for Regulators, by virtue of some strange and arcane exemption clause buried in all the legislation within which the FCA is supposed to operate, according to a colleague with whom I raised this question quite some time ago, apparently it isn’t. Why not? Why does the regulator of the financial services industry have a special opt-out? A number of other regulatory bodies actually state on their websites that they are bound by and observe the requirements of the Code, but not the FCA.

    Mind you, that didn’t stop the FSA claiming in a written response to my MP that that it does indeed observe the requirements of the Code, even though it declined to offer a single example. Plainly it doesn’t, yet it claims that it does, and my MP just accepted this claim at face value without making any effort to challenge it.

    And what is APFA trying to get done to bring the FCA into line with all other regulatory bodies?

  3. Would we be better off if the cost of this regulator was redirected into resolving the problems that the regulators failed to avoid in the first place i.e. (PPI), bank charges, Northern Rock ,the rest of the banks, Equitable Life, split-cap trusts, precipice bonds, the LAUTRO 19. In fact what does the regulator do other than take huge fees and act as a business prevention unit?

  4. All Government’s feel it appropriate to use outside agencies that they invent but then claim to be independent so as to evade the responsibility for stupid actions.

    Spending other peoples money like Croesus on acid is one of the activities that the regulator excels at.

    When I met Hector Sants he pointedly told me that it was not all 5 star hotels and then sat down and made notes on his FSA embossed notepad using an FSA pen.

    As Julian continually points out, until there is some form of oversight to curtail stupid actions and profligate spending the ‘Viv Nicholson’ mindset will continue.

  5. Kim, I agree but have you EVER found ANYTHING that the FSA/FCA has done that is good value?
    I can not think of a single thing.
    Answers on a post it!

  6. Anon @ 1.48
    Surely a post it would be a waste of space?

  7. Peter Hamilton 10th June 2013 at 4:26 pm

    This is a good example of what I said recently: the FCA needs to be held accountable by a body with the courage and power to impose appropriate sanctions. Until such a body is created the best hope for the industry is for the Treasury select committee to take a serious interest in what the FCA is up to.

  8. If only it had been just a rebranding exercise and change of the letter ‘S’ to a ‘C’. The new FCA Website is a appawling to navigate with irritating hover over drop downs and content in weird places. The FCA Handbook is not even hosted on the FCA site and instead is the same FSA Handbook just carved up. The FCA logo is also something a 12 year old could have put together. To think that they paid over £1m for all this is beyond belief!

  9. @ Peter Hamilton
    Agreed Peter.
    Until this happens, advisers will continue to live in a state within a state, where democracy, together with the rule of law is suspended.
    The whole sorry situation reminds me of “The Enabling Act” of 1933

  10. Well … pink instead of purple, a different type face and pretty pictures on the front of policy statements makes the whole regulatory experience much more pleasant …
    What does not is the fact that after years of banging on about getting focussed information targeted to small adviser firms clearly signposted and accessible on the website, including RSS feeds for relevant updates the rebrand has removed all this.
    Retrograde.
    Short-sighted.
    Totally unnecessary.

  11. Sometimes we pick the wrong battles to have a go at the FCA. This article is one that pampers to our mistrust and dare I say it hatred of the FCA. The change of regulator was bound to cost money and rebranding was inevitable and sadly this does not come cheaply. I do not think anyone is in a position to ascertain whether this was fair value or not.

  12. @ Sam
    “I have worked with dozens of financial services advertising agencies and currently control and update the content of three websites”.
    Kim North is in that position and the rest of us (with the exception of one or perhaps two ) have the wit to realise she is correct.

  13. Some comments here talking about value for money from the FCA . I attended the siive Compliance seminar in Leicester yesterday and it was the best £120 I have ever spent.

    The speaker was superb, knew his stuff and spent time individually with all delegates. If thats what the new regulator is offering then I’m all for it. ….and the day that we start analysing the kind of pen that Hector Sants had, is the day we should all give up.

  14. @ Andy
    Why should we have to pay £120 on top of what we already pay, to find out what the rules are?
    Hector probably took his pen with him, so no need to analyse that.
    Do you also think it right that the art work at CW has been replaced?

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