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NCC wants taskforce on advice for lower-earners

The FSA should implement the defined-payment system but only when it has sorted out extending access to advice to lower-earners, says the National Consumer Council.

The call comes in the same week as the body representing IFAs within the FSA, the Small Business Practitioner Panel, says the regulator should drop the depolarisation proposals affecting IFAs.

The panel says the DP system and the FSA&#39s “narrow determinant” of what constitutes independent advice is damaging to the sector and will lead to far more IFAs than the FSA is expecting to stray to other channels.

It proposes a similar alternative as Aifa to the DP system with a menu option for disclosure allowing consumers to choose how they pay for advice.

The NCC, which is funded by the Government and industry, says commission distorts the market and is backing the DP system as a result.

It is more concerned with the needs of lower-earners and rejects the FSA&#39s lower-tier proposal, saying that simply adding another tier of advice is not the answer.

It calls on the Government to establish a taskforce to look at possible options to pay for advice for the less well-off, including a levy on the industry and public funding.

Senior policy officer James King says: “We accept the argument for reform because it will not make things worse and on occasion it may even make them better. We do not think polarisation or depolarisation is the answer to delivering advice to those who cannot currently afford it.”

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