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Outside Edge

As the Equitable roadshow lumbers around the UK, we are informed that the Faculty/Institute of Actuaries report reflects that had this company dealt with IFAs, matters could have been different.

This reminded me of one when I had to hand in an application for a single premium to a retirement annuity at the Glasgow office of Equitable. Up until then, I had dealt with one particular representative who happened to be out at that time. As we concluded our discussions, my usual contact arrived and what then followed can only be described as a melee as the two reps pulled at the application with a degree of fervour that, as a Partick Thistle supporter, I am not familiar with.

This late but welcome app-reciation of the IFA seems to be infectious, with the Government minister making positive comments about us in the same week.

When I (and some 350 others) attended last week&#39s meeting on polarisation with the FSA, the clear message was that multi-ties were not a foregone conclusion and the “better than best” rule would rem-ain. This must have been a bit of a blow to all those devotees of multi-ties who would now seem to have extrapolated their ideas to a point where the FSA are not inclined to go to now or indeed in the future.

We were then treated to a management consultant suggesting that we could do away with polarisation and replace it with all advisers as independents. The rep from the consumer association pointed out that those creators of “trendy wine bars” would be unlikely to accept such a suggestion either now or in the future.

What we need now is to capitalise on this new-found popularity by ensuring that we start to explain the value of advice, not by words but with figures. This could be done in a variety of ways and is a subject I will return to in a later column.

In the interim, perhaps the letters page of Money Marketing could be used in a positive fashion to generate some ideas in this vein.

What I am thinking of is looking at the financial impact of advice compared with the cost of the investment(s).

Simply talking about the value of advice without proof is no better than those who suggest that mutual companies are always superior while not providing the evidence to prove their case in the form of validated statistics.

Last Thursday&#39s FSA event gave me real hope that the regulators understand the need to avoid making matters worse for the consumer while improving the lot of the direct and tied distribution channel.

The strategy behind a rec-ent major acquisition was explained by the phrase “we were the prettiest girl on the block” in the light of last week&#39s event (and retaining the dating theme) this first impression does not always hold good the morning after and at the risk of being accused of mixing my metaphors perhaps its better being a tortoise and not the hare.

What is clear is that the generic title IFA will not be the sole point of differentiation going forward with the reintroduction of a buyer&#39s guide where the profile of the adviser, for example, APFC passes, and perhaps details of what the IFA will do and the likely cost, in other words, fee-based looks as if it may be on the way. But to conclude the story about the two Equitable consultants, I eventually managed to remind the two warring reps of my presence and left them with the parting shot: “Why all the fuss, guys, it&#39s not as if there is commission at stake.”

Robert Reid is principal at Syndaxi Financial Planning. email: robertreid@centaur.co.uk

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