A fter five years of distinguished service, Paul Smee is off.
IFAs will be losing a very skilled operator and a well respected problem solver. Paul's style could not have been more different to mine but in one way we are very similar – we both tell it straight. Not doing so all-ows ministers, civil servants and regulators to go off into a dream world. You only have to observe stakeholder pensions to see where that leads.
The best way of doing the job is to get close to the civil servants, sharing with them what you are going to do, hope that you will be treated fairly by them and that they will influence their minister to make an acceptable decision. This requires a considerable level of trust on both sides.
In the early Fimbra days, while the industry was still under the Department of Trade and Industry, I played a departmental game as well as anyone. The DTI civil servants had a very clear business-based mindset and just wanted to bring in a method of regulation that offered a degree of protection to the public without hitting the industry with undue costs.
Sir Kenneth Clucas set the practical tone with his famous phrase: “Regulation that stops people being made fools of but does not seek to stop fools from their folly.”
It is often forgotten that after Lord Elton was removed, we had a number of years in which the trade association, regulator and the DTI were all travelling in the same direction with a level of co-operation which not been bettered since. There was no shortage of trust on either side.
The changeover of Fimbra to the PIA saw both Godfrey Gillings and Sir Gordon Downey completely outmanoeuvred by the more theoretical elements within regulation and trust disintegrated from there.
The die was finally cast when the Government unwisely used one of its business days to trumpet its success with the pension review only to find itself roundly condemned from all corners of the House.
The Treasury inspired a number of events that created Aifa, ridding them of the pestilent priest who had been a thorn in the side.
Aifa was to have a new unconfrontational style and a low-profile leader and get back to playing the departmental game.
There were a number of candidates but Paul was head and shoulders above the rest. Paul came to the job modestly announcing “he was not a household name even in his own household”. Paul had also been my contact during his time at the ABI and what was not understood by many but I knew well that what was behind that modest exterior was a very fine communicator. He has continued to travel extensively, speaking to IFAs all over the UK. His attitude with the regulators has been very much the concentration on the practical solution, with his menu option being a good example.
What should we expect of his successor? Whoever takes over is blessed with a first-class back-room team, many of whom started with the IFA Association. But running a trade association is like being a football manager. You work long hours and travel thousands of miles while every member of your club knows more about your job than you do, so considerable stamina and a thick skin are important.
This is going to be even more important when de-polarisation comes into force next year. Aifa is in great danger of losing its focus, even its raison d'etre. Holding together the diverse interests of financial planners and the bigger groups will take some skill.
Paul has continued the work in Europe that I started and that must continue. The next excuse for greater regulation will come from Brussels. The dream of a single European market is still just that and distribution in Europe is very different to the UK.
Paul has re-established the trust needed for the smooth conduct of business. His successor must continue to do the same but when proposals are wrong, straight words must be had. If that does not work, the new recruit must be willing and allowed to fight for the membership.
Garry Heath is executive chairman of the Special Risks Bureau and was director general of the IFA Association from 1989 to 1999