Managing director Hugo Thorman says the RDR should go further than plans to split the adviser and product provider’s charges so fund manager and platform provider’s charges are also clearly distinguished.
He says: “What we like to do is split adviser, product provider, wrap platform and fund manager charges. That is the fairest thing to do so the client can see very readily what each is costing.
“For those who oppose this idea, it is either because they cannot do it because of their systems or there is some cross-subsidy taking place that they do not want people to know about.”
He believes it is inevitable the FSA will call for a separation between investment management and platform charges after its review of the platform market.
Skandia head of proposition marketing Peter Jordan says: “Transparency is fine but if that results in a complicated picture being presented to the client, then it will call into doubt some of the benefits claimed from this approach. The danger is if you go to the umpteenth degree to unbundle in the interest of transparency, you will largely be left with a marketplace where customers do not understand what their costs are.”