Providers says half of advisers set for restricted move

Around 50 per cent of advisers will move to a restricted model over the first three years of the RDR, according to Zurich and Partnership.

Speaking during a panel debate at the Tenet annual conference held in Windsor last week, Zurich chief growth officer David Etherington and Partnership managing director of retirement Andrew Megson agreed that around half of the current adviser community will move to a restricted offering.

Megson said around 15 per cent will have a restricted model when the RDR comes into force but that figure will rise significantly over the three years to the end of 2015.

He said: “I suspect something in the region of 15 per cent will be restricted at the start of 2013 and over the following three years something in the order of 50 per cent will go down the restricted route.”

Etherington agreed, adding: “There is a lot to be said for independence but advisers have got to make commercial decisions and it will be difficult for firms to demonstrate they are independent. I can see 50 per cent going restricted as well.”

In October, Tenet said that 80 per cent of current IFAs would have to change their business model to remain independent after the RDR, as the vast majority of advisers do not currently comply with the FSA’s whole of market requirements for independent advisers.

Consilium Financial Planning managing director Kevin Morgan says: “IFAs are a very resilient bunch and you have to wonder if product providers bandy these kind of figures around because it is in their interests. I would predict that a much higher number of IFAs will remain independent in the next few years, something around 75 to 80 per cent.”