View more on these topics

Outside Edge: Robert Reid

Those avid readers of Money Mail may have noticed this week&#39s main article which focused on the Financial Planning Certificate and the problems of competency involving some 1,000 advisers from a direct salesforce.

When they first approached me for my views on FPC, I tried to explain the rationale behind the level at which the tests were set. Unfortunately, it is impossible to justify a level which is less than most of the public would quite rightly expect of a professional adviser.

I was delighted to see that David Jackman supported the view that a higher level of testing was overdue although if retesting every three years is, as he suggested, likely, then we need to start thinking outside the box and not simply produce son of AFPC.

In the time available, the AFPC was the correct way forward but the advances in interactive technology, especially over the internet, and the demands on the time of an IFA no longer make this viable, irrespective of it being available in half or whole subjects.

Nor do I believe that it achieves its objective of developing the individual. In the review of training and competence, the FSA clearly stated that continuous professional development has to be based on the individual&#39s needs.

This makes it very difficult if not impossible for the traditional examination to be other than “one size fits all”. This then means areas being tested where competence is not required or not enough testing in other areas.

Most people currently consider that one AFPC exam every six months is about right and this would form a major part of their CPD programme. However, if they are unfortunate enough to fail the examination, it is questionable whether all the time can then be described or logged in the development plan.

If we are to follow a more modular approach, we could allow for study over a longer period, with retesting part of the process, and the number of modules would relate to the time over which the study was undertaken. Again, the use of technology here is a no-brainer, as without it this approach would grind to a halt.

In the fullness of time, we may see university degrees as the minimum entry qualifications but, as new LIA president Michael Bousfield stated, the profession cannot currently compete against the likes of a career in law or accountancy.

As I have said many times, if we want to be seen as professional, we need to evidence our competency.

So before we find ourselves retested every three years using the current exam structure, let&#39s try and come up with a more sensible alternative to the current system, where the soft skills as well as the ability to recall facts are given the correct balance when arriving at the mix we need in testing as we build this profession.

The public have a right to expect that those professing themselves to be professional live up to their billing.

Some of you may suggest that my criticism of FPC is unwarranted but let me ask you this – if the surgeon about to operate on you was only tested to a level similar to FPC, would you let him go ahead?

After all, financial planning may not be as important as heart surgery but, if it is done incompetently, then the results can be just as serious, from which the individual may never recover.

Perhaps we do need, as the incoming LIA president reportedly suggested, more sex appeal. However, if that requires me to acquire a permanent suntan or an identity bracelet, then I for one will have to make do with what I currently have.

Robert Reid is principal of Syndaxi Associates. To discuss any issues raised, please contact


&#39Fund supermarkets set to save IFAs 20%&#39

IFAs using fund supermarkets could cut their costs by up to 20 per cent, according to a report from Cerulli Associates. It predicts IFAs are set to account for more than a tenth of all assets in continental European fund management by 2005 as the power of the banks is eroded. The report, which will […]

Virgin Direct pension sales up

Virgin Direct pension sales for April were up 152 per cent on the same period last year. Nearly 10 per cent of its stakeholder sales were for children and 31 per cent were taken out by savers in their 20s. A fifth of sales came through the internet and the average direct debit contribution in […]

Prime time for Royal & Sun Alliance

Royal & Sun Alliance has put the focus on individual stock selection with the introduction of the UK prime fund. This Oeic aims to deliver capital growth by investing in a portfolio of around 30 stocks. Investors who want to draw income from the fund can make cash withdrawals under a facility called selector which […]

Fix is good for Mortgage Next

Mortgage Next is targeting first time homebuyers and people looking to remortgage their homes with the two-year fixed rate mortgage.The mortgage has a fixed rate of 5.58 per cent for loans of up to 95 per cent of valuation for the first two years of the mortgage. After the fixed rate period it reverts to […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers. Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm