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Menu is too inflexible, says Flight

Shadow Treasury Chief Secretary Howard Flight has criticised the FSA&#39s menu proposals and blamed Aifa for failing to push for a less rigid system.

Flight believes the menu has been over-engineered and that Aifa has failed in its resolve to make the proposals as workable as possible for IFAs.

He broadly welcomes the idea of clearer commission disclosure but does not believe the menu proposals will make a significant difference to customer service.

He thinks clients will be unable to distinguish between independent and tied advice and says the proposals focus too much on products rather than advice.

Flight believes the increasingly complicated material that IFAs are expected to plough through with clients will give them even less opportunity to be innovative with the financial planning services they offer. He thinks rigid requirements from the FSA give IFAs less scope to offer more flexible, sophisticated services.

Flight says: “The menu was an Aifa suggestion and I think the FSA would have been very wise to take heed of any criticisms Aifa had. In principle, I support the ideas behind the plans but, as a consumer, all I am interested in is what I am paying and if the total I am paying for that service is reasonable.

“If the requirements are the same for tied and independent advisers, these proposals do seem to be muddying the waters in a crucially important territory. The danger would be that the clients do not understand the difference between the different types of adviser and will only see the various prices.”


&#39Useless&#39 PI cover up 14-fold in three years

Sofa chairman and Informed Choice director Nick Bamford has seen his professional indemnity insurance premium increase by more than 14 times in three years for cover he believes is effectively useless. Bamford says his premium has risen by 27 per cent to £40,000 for the year from February from £28,875 last year – a massive […]

NU says NAO conclusions are no surprise

Providers say they are not surprised by the outcome of the National Audit Office&#39s review of the Government&#39s £1.4m lifetime contribution limit cap published today. Norwich Union says it expected the NAO to largely agree with the Revenue&#39s estimates of who would be affected immediately and in the future by the implementation of pensions simplification […]

Ipswich Building Society – Two Year Discount Fee Free Mortgage

Type: Discounted-rate remortgage product Discounted term: Two years Discount: .05% Payable rate: 4.75% Minimum loan:£25,000 Maximum loan: Up to 80% of valuation subject to a maximum of £350,000 Income multiples: Loans up to 80% of valuation &#45 3.25 times principal income plus second or 2.5 times joint, loans up to 75% of valuation &#45 3.5 […]

Cable calls for Parliamentary Ombudsman

Liberal Democrat Treasury Spokesman Vincent Cable has called for the Parliamentary Ombudsman to investigate whether compensation is due and in what forms. Cable says although Penrose does not make recommendations on compensation the report holds that policy holders have had much worry and distress, with many continuing to experience financial hardship. He says the Government&#39s […]

Derek Stuart: where to find value in the UK?

Derek discusses a number of Œself-help stories as examples of where he is finding good opportunities in the UK With the FTSE trading at historically high levels, many investors have questioned whether UK equities continue to offer value. But, as Derek points out, the headline figures mask many opportunities at a sector level. He has […]


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