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Professionals ponder a new blend

A possible alliance of the various professional financial services bodies has once again bubbled to the surface.

A new impetus seems to have arrived since the resignation of LIA chief executive Jeff Travis but the fact that the LIA, the IFP and Sofa are looking towards each other is more to do with industry issues.

Syndaxi Financial Planning principal Robert Reid says: “I think Travis is largely irrelevant. What influences the shape of the trade bodies is not an individual but the shape of the market. I think he may have been one of the barriers but what really matters is the different types of advisers that the bodies represent.”

This week, LIA director of public affairs John Ellis confirmed that the various organisations are in talks and have been for some time.

He says: “The process is under way. We have been having talks. I think it would make sense for the professional bodies to be represented by one voice. I am not sure that there are any major barriers but there is still a lot of detail to be sorted.”

No one expects there to be a merger overnight. Each of the three bodies offers different services to their memberships.

The LIA, the biggest of the three, comprises primarily current or former tied agents. It is viewed throughout the industry as still being made up of life insurance salespeople.

Sofa is the IFAs&#39 professional body. Through its relationship with the CII, which effectively owns it but gives it a fairly lengthy leash, it is active in training and competence and examinations.

The IFP is also involved in testing its membership but at a much higher level. Through its AFPC regime, it aims to raise the standards of financial advisers, moving towards wealth management on a fee-charging basis.

Given their differing membership and mandates, there are many details that need to be sorted out before any merger, including what the body would be called, where it would be based and what would happen to the staff.

Ellis says: “If there is a will to do it, then we will deal with these difficulties – and I think the will does exist.”

Sofa chairman John Porteus will not go as far as Ellis but says he is open to working with the other bodies on responding to industry issues. He points to recent examples such as the FSA&#39s discussion paper setting out the framework for the examination review and CP 121, where the bodies are co-operating.

He says: “For a long time, a number of people have felt that a single body is the best way forward. They have in recent times spoken with more unison than ever before.

“There are certain issues of overlap or commonality where we have felt it was appropriate to act together.I am prepared to entertain all options. We are ruling nothing out but are also ruling nothing in. You have got to go out on a date before you get married.”

But IFP chief executive Nick Cann has thrown down the gauntlet to the other bodies. He sees great advantage in having a single organisation representing advisers.

Cann says: “If the question is, should there be a single professional body, my answer is yes. We would do better by having one professional body. If you are going for a single body, however, the structure must allow for the different components of the industry.

“A merger would undoubtedly be for the good, but you would still have to retain what is important to the membership of the individual organisations.”

The one group that stands apart is Aifa. Director general Paul Smee says its role as a trade body is different to the professional bodies. He says: “There is a significant difference between Aifa and the other bodies. We are talking about commercial interests and industry issues while they look after professional issues such qualifications.”

It may not happen overnight but certainly it appears as if closer co-operation and a possible merger is on the cards. For years they have been trying without success to achieve this goal.


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