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Providers must take the blame for FSA tree

The FSA is to design a single decision tree and will force providers to

stick to the template in all stakeholder key features documents.

It has washed its hands of any responsibility for misbuying that might

arise from using the tree, prompting fears that providers will be left to

pick up the pieces.

The FSA revealed its thinking behind the use of the decision trees as part

of the advice process at a conference in London on Tuesday.

Speaking at the Designing, Marketing and Distributing Stakeholder

Conference at the National Liberal Club, FSA group manager (investment

business policy) Norman Digance told delegates categor-ically the FSA would

take no responsibility over decisions made using the trees.

He also confirmed the regulator had finally decided to address the issue

of minimum income guarantees.

The Mig issue had previously been a major stumbling block in the advice

process. By failing to address the issue, the FSA risked being responsible

for a massive misbuying scandal as thousands of people bought stakeholder

only to find they would have been better off by not saving at all as they

would lose valuable state benefits.

In a further move, described as putting a nail in stakeholder coffin, an

FSA report claims most people would be better off saving in a Catmarked Isa

rather than a personal pension.

Scottish Life communications manager Alasdair Buchanan says: “We welcome

the fact the FSA is making decision trees prescribed but it is difficult to

see who will take responsibility for them other than the FSA. So it needs

to come off the fence and take some responsibility.”

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