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LibDems say IFAs are a “doomed species”

The IFA is a “doomed species” which will suffer at the hands of an increase in demand for free, electronically delivered advice, according to Liberal Democrat Treasury spokesman Lord Newby (pictured).

Money Marketing asked Newby, who was speaking at a fringe event at the Liberal Democrat conference in Liverpool today, what role IFAs have in the future of financial services.

He said: “The traditional model of the IFA looks to me like a doomed species. I think there will be a drift away from old fashioned financial advice.

“The regulatory requirements on IFAs are so great, the cost of giving advice is so great and I cannot image why anyone would want to do it. It just looks to me really, really hard.”

Newby said his children’s generation would seek advice almost exclusively online.

He said: “I do not think they would want to go through the appalling business of laying out all their details and taking an hour to go through everything the way we did when we were buying financial services products.

“I hope people do take financial advice but they will want it free and they will want it delivered electronically.”


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There are 125 comments at the moment, we would love to hear your opinion too.

  1. “The regulatory requirements on IFAs are so great, the cost of giving advice is so great and I cannot image why anyone would want to do it. It just looks to me really, really hard.”

    So why do the government of the day sit by and allow the regulator to continue down this path? Is the regulator more powerful than government?
    Perhaps the real reason is that come the next election Lib Dems will be as much a doomed species as IFAs

  2. “The regulatory requirements on IFAs are so great, the cost of giving advice is so great and I cannot image why anyone would want to do it. It just looks to me really, really hard.”

    …er, so why not make the provision of decent advice simpler, easier and cheaper so MORE people can get it, not less?

  3. Ha ha! Surely he means the LibDems are a “doomed species”? I think they will be extinct before IFAs.

  4. George Emsden (cancerIFA) 21st September 2010 at 11:45 am

    Have to say he is probably right. Looks like long-term survivors will be HNW client firms, and employer/group based firms or maybe niche ones. Professonal connections will be crucial.

  5. This just shows how important that it is that the IFA demonstrates the value of what they can offer – tranasctional IFA work will die.

  6. Confirmation of what I’ve always suspected…Lib-Dems are thick.

  7. Newby comments “appalling business of laying out your details to an IFA” how strange, would he rather we guessed and got the advice wrong? In any case if he thinks his kids can sort out their own inheritence tax planning on line then why do we need to take a huge amount of extra qualifications which are demanded by the FSA or government under another banner??? I suggest you engage you brain before you open your mouth.

  8. Thanks for the vote of confidence!!!

  9. Heaven forbid that people would spend a whole HOUR simply wasting their time choosing the best mortgage deal for their needs or making sure their protection plans are arranged properly and written in trust… what a waste of time! (NOT)

    I cannot believe the faceless internet suits all situations. Clients do still value the face to face contact received when visiting a broker/IFA.

    I bet Lord Newby doesn’t make his investment decisions without some advice.

  10. Frightening!! another individual of so called intelligence with absolutely no idea of “Financial planning” yeah people are really gonna research the complexities of our industry and make an informed decision on line. the man is a Joke!!!

  11. Marziah Rehemtulla 21st September 2010 at 11:51 am

    When most of the population have no pension, no savings, no mortgage repayment vehicle in some instances, how on earth will they manage complex affairs with no face to face advice. Mr Newby need to sit in front of a quality IFA and really understand how a good hour with a professional can sort out your finances for ife. What a clown!!

  12. I think it’s as valid to say that the Lib Dems are a ‘doomed species’.

    Both will survive in the long term, though maybe in slightly different forms and using different methods.

  13. Sadly, I have to say that I tend to agree with Lord Newby. Everybods wants Free Advice. Nobody wants to pay for it. Nobody wants to have commission charges deducted from their money. . . . . and the FSA want their many pounds of flesh out of a shrinking supply of profits. . . . I suppose the good thing is that sooner or later there won’t be any money to pay the FSA-type people and they will all have to get real jobs !

  14. I hate to agree with him, but he is probably right. The only reason its like this though is because of the regulators and government.

    What they all fail to see though is that ordinary people as well as the well off like to talk to someone and get personal advice tailored to their needs.

    He also fails to get a grasp on free advice. Hasn’t he learnt yet nothing is free. Unless the government set up a financial advice system like the NHS paid for by tax payers then the advice will be paid for by the product providers the cost of which will be factored into the cost of the product.

    So effectively products are sold with no real advice and no real choice. Just what the banks want.

  15. So what about the generation that do not use computers? Technology is not as all singing and dancing that everyone in Whitehall thinks it is and the last thing I would ever buy any financial product is on line. No mortgage lender yet can put their hand on their heart and say we have a system that can cope with every scenario and be able to provide a service where the customer knows what they are buying and is familiar with all the financial terminology is.

  16. not as doomed as the lib dems are when their support ‘rewards’ them for getting into bed with the tories…

  17. Henceforth let 21 September be known as “Newby is a Fool day”! What planet does anybody live on who believes that they can get “free advice” from anybody/ any method. This completely beggars belief and demonstrates how so far these people (members of the ruling Government) are with what an Independant Financial Advisor actually does.

  18. yet again an ignorant person under the disguise of a politician

  19. Lord Newby obviously has never had an adviser himself or he would understand that it is not appalling to have someone sort out your finances for you , over and above what we are paid for. we look after our clients with the utmost care, respect and responsibility. People desperately need help. Over half of Britons have never had a pensions revirew. You cannot get individual advice online. Everyone has different values and needs. This sort of remark does no good for the people who don’t understand financial matters. I help accountants and Solicitors with their own finances, some of which really need help with financvial planning.
    Lord Newby is only talking about picking one or two products when the individual has already made up his mind if he needs it. Still it’s better to use someone who is an expert.
    He soinds like the type who would buy a Will pack from Smiths.

  20. Let’s hope then that Lord Newby’s children will also seek out the governments policies on-line then we can say that politicians will also be ‘doomed’ but there again we have known this for sometime anyway!!

  21. What planet is this guy on? The vast majority of people now and in the future will still want the advice a good IFA will give. Contrary to his belief, they will not want to spend the time inputting all their details into various search engines to find quotes for their perceived shortfalls. This is going even further down the cop-out road. Providers will not give the advice as he thinks, the reason being, mis-selling! By order taking from a client it absolves them of any responsibility. Great for the shareholders but not clever at all for the man in the street. I suggest this person very quickly puts his thoughts into how the real world out there works. People give us the problem and expect us to come back with the answer. The majority would not have a clue, or even want to, on how to navigate a provider’s site to give them the information that they want. By the way, I expect that, should he prove to be correct, then the providers will very quickly find a way to charge for their advice. Remember, nothing in this world is for free, it has to be paid for somewhere!

  22. What a ridiculous statement from and from a treasury spokesman!?
    Free financial advice…how would that be possible? There will always be a cost even online. It would simply be accounted for within the product charges. Maybe he thinks we will get other things for free such as cars etc..sounds great..

  23. Obviuosly doesn’t know anything about it

  24. I think he’s missed the point, people will always want something they percieve as complicated translating into English!!

    The face to face relationship reassures them and allows them to have a point of reference going forward.

    As for getting paid for the service, unfortunatley I do agree with him that the public are not prepared to pay for financial advice.

    If he’s aware of this fact and the majority of the advisers I speak to are aware then why can’t the FSA grasp this fact???

    All they seem to want to do is steam roller through their RDR proposals irrespective of the damage it will do to accessability to financial advice for low & middle earners!!!!!!!!!!!

  25. Is this the highest level of intellectual analysis we can expect from the LibDems?

    Newby’s children may well want free advice but he and the FSA should remember the old agage ‘There’s no such thing as a free lunch’ (unless you are a journo at the LibDem conference)

  26. Tim Harrop-Griffiths 21st September 2010 at 12:02 pm

    Thank you Lord Newby for at least recognising what we do is really really hard.

    Perhaps you could have a word with the FSA and ask them if we could forgo the fact finding and reporting process as this “appalling business” really is a bit of a pain.

    Far better if people take free online advice from, oh lets think who could manage such a task, yes the banks. It’ll all be free and everything will be wonderfull in the world of financial services.

    If only everyone had Lord Nimby’s vision.


  27. I suspect IFAs will be around longer than the Liberal Democratic Party if the feelings of folks around here are anything to go by. I know a lot of people who voted LibDem at the last election but say they never will again now that Clegg is playing Tweedle Dum to Cameron’s Tweedle Dee!

  28. really really hard – shows his educational background – idiot brain.

    And who will be providing the electronic advice, IFA’s perhaps dduuuhhhh

  29. This is just typical of politicians who do not understand or value the service that IFAs provide. Yes, you can buy “products” electronically, but you will not receive advice – for example, term assurance can be bought online, but will the client know that the cover is sufficient? Will they have considered the use of a Trust?

    You can write your will online, but would you want to? If you want/need advice in doing so, you go to a solicitor, who will charge for that advice, and financial services are no different.

    Although IFAs will certainly need to adapt to enure that they benefit from new technology and find alternative ways to engage with clients, a bigger threat may be that providers who, with less to gain from dealing with IFAs, may seek to re-establish direct sales forces. This is exactly what has happened in the mortgage market recently where lenders have sought to deal with customers direct, restricting IFAs from accessing products.

    If policiticians believe that no-one would want to deal with, or even be, an IFA due to the costs and restrictions imposed, perhaps they should look at where these costs and restrictions originated!

  30. It is about time people got it into their heads that advice is not free. Nothing in life is free.

    Just because some offer free advice it does not mean the advice has no cost to the consumer. But of course banks hide behind service to disguise the fact that the product has a commission attached to it.

    Consumers should get used to the idea that good advice should be sought and that it costs.

  31. I think we’ll have “virtual” MP’s as well…….I know who provides a better and more valuable service!
    I agree you can get as much information as you want online, but you can’t get advice. I’d like to see how TCF deals with that idea.

  32. What a complete dinosaur. His ‘taking an hour’ comment just goes to show the type of ‘adviser’ he has experience of – i.e. the salesman type.

    Most of my first meetings are between 2 hours and 3 – which is necessary to fully get a handle on client’s existing affairs, and will have a second discussion meeting after logging letters of authority where more information on existing plans is needed.

    If you get something for free then it’s value is nothing and I am not in the business of ‘adding nothing’ to my clients.

  33. Take it he had drinks last night with Nigel Stockton, sounds like his type of verbal manure

  34. Perhaps you can tell me now why I voted for you?
    Thanks for all your support. If you lot have got it wrong with the economy it is more likely that Lib Dems will be extinct than IFAs.
    You forget how resourceful we are.
    Perhaps engaging brain before speaking is the best advice I can offer

  35. It appears that Lord Newby does not value the face to face advice process, I personally cannot imagine anything worse for a client to transact business with a faceless computer screen without discussing their overall financial situation and making them aware of the potential consequences of doing nothing whilst also taking their feelings into account.
    Perhaps Lord Newby needs to get a new IFA!

  36. You must be joking 21st September 2010 at 12:09 pm

    There’s such thing as FREE!

    If a business is not profitable, it is unsustainable.

    If it is unsustainable, it will cease to exist.

    And this guy is in the treasury??? Now we can see why public sector spending cuts are so necessary – the public sector is made up of morons, living in a utopia where everything is free and it is probably always sunny!


  37. There we go. It is about time the industry started promoting the benefits in independent financial advice. The Great British Public see financial services in the same terms of a can of beans, rather than some sacred knowledge held by high priests. The industry needs a radical shake up, not RDR. Why are we kidding ourselves we are anything more ? The internet has led to the democratisation of everything, motor insurance, life insurance, banking, shoping. We are no different. The FSA has just hog tied people in a mire of legislation and evidence has shown has done little to achieve its stated aims. The industry must evolve or face the alternative.

  38. He may well be right about the next generation but ‘advice’ and the internet do not a happy marriage make.

    As we speak clients are making poor choices and missng out on solutions that would better suit their circumstances mainly because they are choosing from a limited number of potential solutions and are ignorant of the alternatives.

    The idea that clients can effectively become experts overnight is absurd. The technology is getting better and undoubtedly has it’s place but the complexity and choice in the financial solutions arena is outstripping this growth.

    Whilst I understand his view I think he’s showing a marked degreee of ignorance.

  39. How do you get advice online? SOMEONE has to give it to you. Or is Lord Newby suggesting the public use a decision tree to decide whether they should set up an annuity/tax free cash sum/ drawdown/phased retirement/third way annuity?

    He’s definitely right that this job is really hard (at least one politician appreciates that) but we have heard all this before about online advice etc. Apart from dead simple products people will always want to speak to an adviser when it comes to the big decisions in their lives.

  40. No such things as a free lunch

    Also, most clients want to see and be advised by a human being they can trust..

    and help them decipher the complexities of financial products and the various pensions and tax legislation…

    this guy is therefore a nutter

  41. That’s it – lets pack our bags and leave the country, go to New Zealand where we will be qualified as hairdressers.

    Strange though, nearly 60% of my clients are under 40 and are to busy to bother about online “advice”

  42. In the words of Frank Sinatra -“And now, the end is near and so I face the final curtain…”

    Does this mean we’ll have to become life coaches instead, along the lines of Bill Bachrach or George Kinder?

  43. These are interesting comments. Essentially what he is saying is that regulation is killing financial advice, which is true. I doubt that anyone will want to be an IFA in future unless business conditions improve significantly and we will eventually die out for all but the very rich.

    However, if the regulatory burden were reduced in line with the risk that we pose, then our businesses could flourish. We are the firms that can offer that online electronic advice and do it better than anyone else.

    I cannot see how it can ever be ‘free’, although regulators could allow it to appear to be if they wish to promote saving in the mass market.

    If the savings gap is to be reduced then advice needs to be low cost and readily available. The FSA/CPMA need to think carefully about the burden they impose.

  44. Advice needs to be paid for whether it is via fees or commission. It would have been interesting to find out how Lord Newby envisaged his model would operate. The only way I can see it operating for ‘free’ is if it is solely via product providers who make their money over the life of the product – but that doesn’t make it free and doesn’t make it transparent either. In fact it would be like the old days when you had an army of Home Service sales reps selling products direct…high cost products and no Independence……is that the way ahead in the Liberal world?

  45. Well, that’s made sure I never vote LibDem!

    Free on-line “advice” is like do-it-yourself brain surgery – and it is NOT advice.

    Free advice is too good to be true. And we all know the value of things which look too good to be true…

  46. “I do not think they would want to go through the appalling business of laying out all their details and taking an hour to go through everything….”

    Oh, you mean that horrible process where a professional takes the time to get to know your circumstances, needs, wants and desires and then matches that up to an appropriate product and explains the benefits. What a terrible thing to put people through……

  47. Obviously this man has never spent any time with an IFA. Yes some will wish to have it delivered electronically, but even so a face to face meeting allows you to answer all the questions and thrash everything out.

    The internet is a means to an end not the end in itself and buying financial advice is not like buying a car!

    Let him get his advice over the net and see how he gets on.

  48. We would survive quite well if it wasn’t for people like this. Advice on line indeed. You get information on line and not advice. If we are to cease as a species, and I have no confidence that we will survive, it’s got nothing to do with the availability of on-line information. It’s mostly to do with being squeezed out by unfair regulation etc. “Advice delivered electroniaclly.” Are you serious?

  49. If future generations are likely to “seek advice almost exclusively online”, they will get no advice at all. The skill of an IFA is to know what questions to ask, as well as what the answers are.
    Unless educated in finance to a high level, consumers will never know what the questions are, so how can they get the right answers?

  50. Does this guy even understand the IFA role? They don’t always provide advice! Some times they sell concepts to customers and build relationships with them, some of the work they do is already free. I would love to see the website that can do all this and more! Roll on the day when the web can replace politicians and we can choose to listen to the nonsense they spout daily or not!

  51. It is obvious Lord Newby has not benefitted from good Independent Financial Advice or spoken to people who have.

    Most clients, during a meeting, are made aware of other areas which need covering, such as Wills and Lasting Powers of Attorney.

    Long live Independent Financial Advice

  52. Good old Lib Dems….

  53. What an idiot. Shows his total lack of understanding of what an IFA does, and how they are prepared to allow people to receive “advice” online ( to the rest od us this means execution only or direct offer which offer little or no client protection ).The reason we spend ” an hour to go through everything the way we did when we were buying financial services products”. is to ensure the client receive appropriate advice and a recommendation that is suitable for their specific circumstances, This man is a waste of time, who maybe should actually find out what and how IFA’s do before coming out with such drivel.

  54. Yes let people have free advice, the type they have got used to at the Banks and Building society counters, resulting in massive complaints. Will Customers achieve diploma level understanding from free electronic information sent to them to plan their financial future. Incidentally where is this supposedly free advice going to be delivered from electronicall. !!

  55. What about the 200,000 paid more than the Prime Minister, surely they will need some help now that the Government have threatened to clamp down on tax avoidance as well as tax evasion?

  56. Nothing in this world is ‘free’. Over the 25 years I have been in the industry, I’ve seen the regulatory framework designed to protect clients make things worse for them. It destroyed the home service industry I was proud to be a part of, which offered services to people who could not afford the fees of an IFA. This is now to spread to the great majority is it? The wrong products picked from a menu using guesswork, based on the advice provided by a journalist with no accountability. If the public were offended by MPs expences, I wonder what they would think about the extra costs piled onto financial services products by regulations etc. Don’t be fooled internet advice will not be ‘free’ it will ultimately cost more.

  57. I am in Liverpool tonight always wanted to meet a Lord who was a complete Plonker (other than Prescot who would never become a Lord) he said!
    Give us our Human and common law rights back and we will not only survive, but help the people of this (once) great country get back on their financial feet!

  58. Sorry guys but I need to know is there anyone out there who really cares about Independent Finacial Advice other than IFAs themselves?

  59. I’ve just helped a family protect their hard earned savings from the state, recommended that a section 32 bulk buyout is the best option for a client. Guess what? They wanted to sit down and speak to a professional not google it. Newby is a clown!

  60. Why, indeed, would anyone want to put themselves through the regulatory requirements of the FSA and the costs of giving advice in order to give financial advice?

    Thankfully, here is at least one politician who sees the writing on the wall for the IFA profession.

    But instead of asking why would anyone want to put themselves through that, he and other politicians should perhaps be asking themselves why the system they work under should require them to.

    No-one would seriously argue that regulation is not required – but it has to be good regulation with a point to it beyond merely the ticking of boxes which the FSA seems so intent on.

    The FSA Rules are very long on what the IFA has to do and when he has to do it – but almost devoid of any guidance or prescription as to how he has to do it and how he has to record that he has done it.

    As the interpretation of the Rules, and whether or not the IFA has breached them, is down to the entirely subjective judgement of the FSA officer applying retrospective standards – your historical advice and advisory process is judged by current standards and requirements – so it is almost impossible for the IFA to get it right. What one FSA officer likes, the next guy decries.

    Beyond that the FSA demand a standard of perfection – despite the fact that frequently they don’t seem to have much of a clue what their own rules say or how they should do it.

    The problem, Lord Newby, is the mindset of the FSA. They seem to see all IFAs as no more than salesmen selling financial products to customers in the same way that a supermarket sells tins of beans. Random product purchase. And that is precisely where we are heading with the online sale of financial products as Lord Newby foresees.

    The IFAs I represent in FSA investigations ( are all very different people – but they have one thing in common. They are professional advisers. They don’t sell products to customers – they advise clients on their long term financial health. To pinch from a bank’s advertising, they are there for the journey. Not just for a quick dash round doing the weekly shop.

    If the current micro-regulation on a standard of absolute perfection continues then there will be no IFAs left to advise – and then the public will have no alternative other than to self-advise and buy online.

    And what will they buy? The usual old tried tested but largely failed regulated products which don’t work. Tell me a pension that is doing what it said on the tin it would do? All they do do is pump the big providers full of over-inflated charges.

    So who will gain? Not the man in the street.

  61. Lord Newby, does make a valid point. The processes for delivering financial advice need to evolve and become less onerous. Not everyone one wants to sit through a full and exhaustive fact find. Not everyone requires full advice.

    Using the internet a customer can decide and meet heir own needs at minimal cost. IFAs should development different channels of distribution to suit their customerts requirements. The industry needs to evolve instead of rearranging the deckchairs on the Titanic. Look what happened to the travel business. How many of us go Squeezey Jet on line? How many of us last went to a travel agent to obtain fares advice ? And let’s face it, have you tried to get any proper advice from a high street travel agency chain. The FS industry will evolve on similar lines, on line (cheap and cheerful), HIgh Street Banks (large agency chains with limited knowledge) and small independent IFAs (Independent Travel Agencies) when you want somethign a little more specialised. And finaly, when did you last pay your travel agent for advice. RDR take note !!

  62. Here we go again!

    Of course, I have the answer! If products are made available and are low cost, people will go and buy direct. Just like they did with cat marked ISA’s, just like they did with Stakeholder……..when will these politicians (and the FSA) get it into their thick sculls that people dont do that. Yes, they will book a holiday on line. Yes they will buy a car on line. they understand these items and the benefit is immediate. The vast majority do not and never will buy savings on line.

    I deal with high net worth clients and owner managed businesses (I would advise lower net worth people as well and used to until regulation made it impossible…..what a service to the UK that has been!!). My clients are very cleaver people…in their field. They do not and dont want to understand the complexities of our area.

    I could do my own accounts if I wanted. I could do my own will if I wanted, however to get it right I employ someone who is a professional. What is so different about what we do?

    I would venture to suggest, Mr Newby that the one bunch of people we could really do without is politicians who cannot stop meddling in everything. Each one of you cant wait to ‘have a go’ and put your own stamp on something that is usually an area where you have absolutely NO experience and have somehow brokered yourself a position to have your turn with face in the taxpayers trough.

    Our industry created a massive UK savings ratio in the UK. Old Pru/ Britannic style industrial branch providing valuable life cover and savings plans to the lower paid who would never have put one penny on one side. IFAs then selling pensions etc to the higher paid.

    Look back; where did that go wrong? yes, there was a need to clean up parts of the industry, which is when Newby and his like became involved……baby and bathwater came big time!! Since then they have put process and regulation as the way to cure everything.

    What a disaster. Lowest saving rates ever. IFAs being micro managed out of existence and their pals in the banks being allowed to create the biggest financial disaster known to modern man.

    And Mr Newby, you think more of the same eh?

    Didnt someone once say that the true sign of madness is continuing to do the same thing over and over when it is proven to be wrong and you hope for a different outcome.

    For goodness sake Mr Newby and Co, listen to people who have been doing this job for 30+ years NOT to your pal in the bank whose self interest in his next production bonus is key to anything he will suggest to you!

  63. Come the time of the next General Election it could be that the Lib Dems become extinct. Perhaps we should begin to offer them redundancy advice in advance (for a modest fee of course).

  64. I have to say that there is a strand of reality here, and that George Emsden is probably right. Product comparison websites will become more sophisticated for many products, enabling informed choice delivered straight to the buyer. The problem of course is that clients don’t like to have to pay for “advice” and this will mean that they will not have access to the overview and experience that a competent IFA can provide.

  65. what a joker in such a time as this people need a point of call especially with all what is going on……….a point at where a responsible person can help not some kind of online advice in which you give all your personal information to some one you dont even know and when you need an answer you cant get the same person who dealt with you originally and the advice given contradicts another website then you get passed on and you will end up paying for this service aswell and thenwith the fraud anyone will set them up and close down a couple of months later and then who will be held responsible for all those left with bad advice ……..for such important decisions would you go to the internet to get advice …i dont think so wake up ….you are giving terrible advice now and i am sure you were not educated through the web………. what a waste of education …….you must be proud of yourself…..enjoy your little time on stage cos it wont last

  66. Tax avoidance advice will always be delivered face to face so there’s no need to worry. There will be plenty of work to do as every citizen of a state governed by morons has a moral obligation to his/her family to preserve wealth for his/her family and not hand it over to state gangsters. Trusting this government with our children’s future is akin to leaving them in the care of alligators. The more these idiots say, the more determined decent upright people will become to plan to avoid them and their robbing laws. Print off the article – it’s a fantastic sales aid.

  67. May I suggest Lord Newby changes his financial adviser as he is obviously not getting the sort of professional one to one service most IFAs provide. To seek ‘one stop bucket shop’ financial advice over the internet will only add an extra burden to State Benefits when the public suddenly discover they haven’t bought what they thought they had by way of a comprehensive protection contract that actually pays out upon a claim. Whay hope do IFAs have if even the powers that regulate don’t understand our aims and achievements!!

  68. This is the kneejerk claptrap from someone who is so far up the class ladder he neither cares nor knows how advice is given properly.If the onus is taken from IFAs to provide life cover, investments, income protection and pensions- who will provide it? Certainly not the state-Oh that’s right, those loveable misselling moneygrabbers – the banks- Is Newby a shareholder of a major bank, or is he just waiting on his appointment in an honorary role when his hook gets slung from the government?

  69. This man is so detatched from reality he must be a Liberal Democrat. What self serving self opinionated nonsense!

  70. What about the thousands who do not use computers,etc?
    A lot of our clients do use the electronic route, but still call up to recheck,etc.
    Can he help reduce the regulatorey burden, which is KILLING financial services?

  71. When a senior Treasury spokesman provides evidence that there are barriers to entry and continued existence in a market, as Lord Tenby has just done, he has a responsibility to provide that evidence to the OFT, who by law are required to monitor the actions of the FSA for just such obstacles.

    Perhaps, should he fail to inform the OFT, IFAs might do so on his behalf – free and electronically?

  72. There is a lot of truth in what he is saying, the regulatory demands seem to be more demanding of IFA’s. Whilst the banks seem to benefit from light touch regulation.
    However free advice is generally worth the price.
    Clients are almost certainly better off with proper advice, so it would be to clients detriment for the IFA sector to shrink any further.

  73. Harriet Mackenzie-Williams 21st September 2010 at 2:04 pm

    I am just horrified that this is a Treasury spokesman speaking! How do people this stupid get these jobs? Heaven help us all if this is as bright as they get.

  74. This demonstrates why the country is in such a mess, we have unthinking plonkers like him running the country and Bankers who are very clever and have to much power that the Government are frightened to act against them.
    As for the FSA they are like a run way train with a cash box soaking up all our hard earned money as IFA’s..yes we are under threat and so is the future security and financial health of our clients and many more who may try to seek advice in the future……to match this stupid mans internet advice for free model maybe everyone should be forced to take level 4 exams…….we should stand together and fight this or we will be doomed and the skills we have lost to the country for ever …. I think I will get out in 2013 as I predict after RDR will come compulsory annual relicencing at £500 a time……….after all the FSA morons are not going to make themselves redundant so they will think up news rules for sure……..What a bloody mess

  75. One of the worst, most crass comments I have ever read. He clearly has absolutely no idea what he is talking about – nor any idea of the real value of advice from an IFA.

  76. Lord Newby seems to have a poor grasp of commercial principles and the added value brought to the financial market through IFA services. To illustrate my point, it is possible to “translate” English text into a foreign language via internet translation tools. BUT to entrust a serious translation to a machine could get a surprising result. EG in French “il est marron” could mean “he is funny”, OR “he is brown”. The expertise of human translation will not make the same error. The point is that an IFA, like a translator ADDS VALUE TO THE PRODUCT FOR THE CLIENT, which the internet will always find difficult to achieve at nil cost.
    In draw two conclusions, firstly, I believe that Lord Newby needs to go back to commercial school to learn some fundamental lessons and secondly I emplore all serious IFAs to remember the value they add for their clients.

  77. Now is the a Lord from or lives in NUMPTY LAND. Alright for him being born with a silver spoon at birth, what happens to the ones born with plastic spoons? Wonder who he goes to advice his *ank manager????
    Is he Lord Prat of Newby??????

  78. For those who ask who apart from IFAs cares about IFAs, I am not an IFA and I do!

    Mark @12:45 talks about deck chairs on the Titanic and not paying fees to travel agents.

    It occurs to me that if travel agents had been under a similar regulatory regime in 1912 then they could have been liable for recommending their clients sail on the Titanic, not warning them that it might sink, not carrying out due diligence on the number of life boats etc.

    There seems to be too much dumping of responsibility for the failings of others on IFAs.

    What will they do if the computer gets it wrong – sue Bill Gates I suppose.

  79. Lord Newby (name a coincidence, you think?) evidently considers the Robert Peston “panic panic panic” school of thought a more rational route to long term financial planning than spending an hour (usually more) with an experienced professional.

    And this font of unparalleled wisdom speaks for the Treasury itself. It’s not just IFA’s that are doomed, we’re all doomed!

  80. I think he’s right. The “factfinds” labouriously completed face to face could be replaced and done in a fraction of the time by smart interactive factfinds linked to research tools funded by advertising. Hang on to your HNW and elderly clients because Joe Public soon gets the hang of technology if there’s money in it!

  81. Talk about poacher turned gamekeeper! many of us would have thought the Libdems were a dommed speciaes, not long ago!
    Perhaps they can now wield some of their mighty power and sort out the regulators and legislation, which would make giving advice a little easier!

  82. so lets get it straight – advice will be free. No remuneration whatsover. When will this imbecile understand that when someone says advice is “free” that it really means cross subsidised by something else….ie. a sale. The term “free advice” should to be banned because some idiots (even MP’s) aqctually believe it is and that people can make a living doing it.

  83. Newby is a professional politician. He graduated from Oxford in 1974 and has been a civil servant (“Yes Minister” world) since 1977. Can’t work out from Google whether he has actually ever done anything else!

  84. Oh dear Oh dear Oh dear the quality of the political elite we have today is truly worrying.

  85. John Joe McGinley 21st September 2010 at 2:44 pm

    Why do people deal with advisers, it’s due to their experience, empathy and expertise. Yes, the transactional sale will be done on line but the need for advice is growing not diminishing.

  86. No doubt, as an MP he would be reluctant to ‘lay out his financial details’, and we all know why!

  87. What an absolute joke, how do people like this become Lord’s. He hasn’t got a clue.

  88. If this is the level of fact find that your average IFA uses before making a decision give me the meerkat anyday. What the man is saying is that the current model is not sustainable something that alot on would agree with. He is not saying that it is not desirable to seek advice just that the current model (cost, regulation and time) are not models that fit well in the internet age.

    Maybe more scrutiny of what is being said would be appropriate.

  89. IFA’s say Lib Dems are a “doomed species”

  90. He may be proven right. However, I have many, many clients who you would have to say are intelligent or clever at what they do – surgeons, architects, solicitors, GPs, teachers, engineers etc. But I have yet to meet more than half-a-dozen that have a clue about financial planning, tax matters, protection products or even mortgages (and don’t even think about long-term care, equity release, income drawdown and other slightly more complex issues).

    God help all those people when the only source of information (NOT ADVICE) is the internet or your ‘friendly’ bank robber – sorry about the Freudian slip, I meant bank manager.

  91. “appalling business of laying out your details to an IFA”

    Good grief, what sort of IFA did he use?

    Bring on the Solar Flare PDQ…

  92. IFAs provide a greater needed service than do politicians so why not get rid of them and run government decisions onlinme? Wouldn’t that save a lot of taxpayers money??

  93. Sorry to say he is right. HNW clients will pay but nobody else will, they already don’t. The problem is that most of the public believe that they can sort their own finances out with a quick look on the internet and a chat with a mate at the pub. They certainly aren’t going to pay out £500 upwards to an IFA because they are unable to quantify what they are actually benefitting from. Ahh! Ignorance is bliss! And don’t the banks know it.!!

  94. A politician who is patently incapable of being liberal or democratic, it is worrying that he is in a position of influence within the regulatory juggernaut.

    Nothing is safe from these muppets.

  95. Crazy gang IFA member 21st September 2010 at 5:40 pm

    Wow! what a thing to say. So it is ‘appalling’ to sort out one’s financial affairs is it? I think he has been lunching with too many bankers, did I say Bankers? This guy is a waste of space and should ‘get his coat’ I think. If this is the type of people’s leaders we have got look forward to I pity the whole country. He certainly lacks any backbone at all.

  96. Interesting that New Labour was the devil incarnate for IFAs last year, whereas now its the Lib Dems (or is that the Government?!)

    Maybe, just maybe we are not well liked by the governing classes?!

  97. So the FSA & RDR are continuing to over complicate the advice process to the point that it’s going to become unfeasible to offer fee based advice. Then no advice will be given and standards will drop and people will suffer. Nice TCF! Why not simplify regulation to give the clients what they want!

  98. surely getting financial advice online is a contradiction in itself? Do you think Newby fixes his car online? Sorry, my fault, he has his chauffeur fix it.
    Perhaps these “Newbies” should keep their mouth well and truly shut.

  99. Forgetting for one moment the clearly nonsensical political commentary there is a point here.

    IFAs are an endangered species because the government and FSA would prefer that advisers fall into one of three compartments – bancassuers, online issuers or, if you must, network members.

    The level of knowledge amongst politicians regarding this industry is woeful but we must remember that it will not stop them from formulating ideas and additional burdens when the new Financial Services Bill is drafted.

  100. Yes I must concur, soon there will be a day when it will be credible to impliment your retirement strategy with the Go compare opera singer or invest in a VCT with the Meerkat ! Muppet.

  101. I agree that assuming IFAs can’t jump high enough to keep the increasing over regulation in check, that the IFA sector is doomed, however it won’t be because clients don’t want to seek face to face advice. There is a breed of client who will always try to do things on-line, but it is a small minority. We only deal with a small percentace of the population. so the governement need to think about the ones left in the middle who still don’t have any advice at all.

  102. Ross Glanfield BSc FPFS 22nd September 2010 at 9:45 am

    Luckily the ill informed, antiquated views of the British aristocracy will never find their way into the modern political landscape. What next? On line open heart surgery? Heaven help us all if this clown gets into Trade and Industry!

  103. So, this is an example of the thinking from a member of The House of Lords,one of the so called great and the good.
    Rather old fashioned sitting on those red leather benches for hours on end draped in ermine don’t you think? What a damn fool!!

  104. This just highlights the reason why I never take the Lib Dems seriously – they just haven’t a clue about the bigger picture.

  105. I have commented previously so really dont have anything further to add.

    I do however have a simple request. Please would someone at MM ensure Lord Newby receives a copy of all of these responses?

  106. Well, you are the government, do something about it.

  107. Anthony Badaloo dipPFS ACPA 22nd September 2010 at 2:02 pm

    IFAs may well be the ones to deliver electronic advice, as they have always adapted and evolved.
    We have never been able to grow due to regulation, thus UK PLC is loosing out to foreign competition.

    So what about the Tories’ promise of less red tape for IFAs ?

    We may well fare better than the Lib Dems by the next election.

  108. On line ‘advice eh?’

    Just this week i’ve applied old pension rules to a clients affairs and extracted most of his pension tax free.

    i’ve helped a new client restructure the shareholder agreement, saved a shead load on cost, improved the life cover and removed a BIK tax.

    i’m assisting a client in arranging matters before (lucky chap) moving overseas.

    i’ve suggested changes to wills that an incompetent solicitor missed.

    i’ve stopped a client from getting shafted on a pension and divorce case, again due to a solicitor with no idea – small fee but saved her £000’s

    I’e improved annuity terms for a client in ill health.

    On Line Me Newby…….Oh Yes! You have no idea at all of what we do!

  109. I wonder if it would be possible to take back OBE’s?

    Perhaps he should add to the doomed list:- Retirement, financial wellbeing, not being ripped off by banks, etc!

    It would be interesting what his thoughts are on getting his lawn cut for ‘free’, and his 2nd mortgage paid for ‘free’!

  110. Trying to foretell the future is a mugs game. I may be a bit of an old fart, but I do have younger clients. But these clients have a life – a very busy one and they really can’t be bothered to fiddle with on line stuff when they can just send me an e-mail and tell me to get on with it.
    Indeed I too fall into that category when booking holidays. Others are perhaps happy to spend a few hours working out flights, hotels and all the boring logistics. I prefer to pick up the phone or e-mail my lovely travel agent –I tell her when I wish to go, how long, what type – beach, culture, tour, city etc and what the budget is. I then get a selection back by e-mail. It takes me about 5 minutes to specify and half an hour to choose.
    My travel agent doesn’t do Butlins and I’m not interested in the mass market. So there you have an alternative view of the future. As always it is different strokes for different folks – and who is this Lord Wassisname anyway and what makes him such an expert?

  111. Crazy gang IFA member 23rd September 2010 at 6:51 pm

    You can all e- mail him at I have.

  112. Yes – predicting the future is indeed a mugs game – but anyone who doesn’t have a well thought out view of what the future holds and plans to match is even more of a mug.

    Having read many of the 110 comments so far my view is that most IFAs seem to have little of no idea as to what is going to hit them over the next few years.

    In general I agree with Newby – a very large number of IFAs will simply fade away, Direct and on line business will grow and the few remaining IFAs will become ever more specialized and expensive – ignoring the mass market entirely.

    Just because this is not what someone wants or just because it will be bad for the public doesn’t mean that it will not happen.

  113. Facts
    1. Its is not advice recived from an online provider.
    2. It is a sale only
    3. The FSA needs to make this very clear this is where the problem lies advised and non advised the public just simply do not know the difference.

  114. someone else post this on another article and I would agree with it what your answer mine is YES YES

    I keep hearing advisers (including myself) saying we should lobby in a much more noticeable way but we never do anything about it.
    Seriously, would any IFAs out there be interested in marching on parliament to plead our case? Just blog yes or no, on here, and maybe we can get something going. I am fed up just sitting on my arse or faffing around writing to MP’s while other people make a nuisance of themselves and get things done

  115. Maybe his children’s generation will choose their MP through or Compare The That would certainly reduce the MP’s exepenses when it came to canvassing for votes.

  116. Under current developments, he is right. There is no future for IFAs in their present format. Due to unfortunate personal circumstances, I have already left the Industry and am busy re inventing my business ,yet again. As a Chartered Engineer and experienced past Industrial Manager, I can now start again think creatively and have a much wider picture of the opportunities ahead. I am amused to watch the Industry drowning itself in a ‘barrel of treacle.’.

    The main objective of this coilition is to cut costs. By reducing the number of IFAs and small businesses, the costs of regulation can also be reduced but is this the way to grow again.

  117. Lord Newby is a Lib.Dem.
    Lord Sharman is also a Lib.Dem. BUT also the Chairman of Aviva.
    The ‘financial advisors’ (sales persons) for Aviva are NOT IFAs, so no-one can get truly independent advice from them or any other the Life Offices.

  118. Rewind 10 years (or so) when technology was just taking off and the doomongers were predicting the exact same fate of face to face advice,…..

    In reality the web has simply resulted in information overlaod for many people so actually the need for advice has probably increased…not decreased!

  119. I don’t think Lord Newby knows what he is talking about!

    Who is going to be giving out this “Free” advice I wonder? There are and always will be people who want face-to-face advice and the IFA in some shape or form will be there to do just that. If the whole population could make their own decisions about such complicated matters then we wouldn’t need solicitors, accountants or other such professional either.

  120. Another completely clueless politician in a position of power and influence commenting on an industry that he obviously doesn`t understand in the slightest. Why don`t they put somebody in power who knows what they are talking about ?

  121. The transactional IFA shouldnt survive, thats not what the jobs about. Has anyone considered the responsibility of the IFA to point out the needs a client has which he may not be aware of, like protecting the family or the limits of governement support in older age or how to claim the available tax allowances. The government should be going out of their way to facilitate the future of IFAs and warning them of the dangers of using single provider Financial Advisors, of course thats assuming that their priority is to ‘look out’ for the ordinary man and women in the community.

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