Practitioner Panel chairman Roy Leighton used the FSA’s Annual Public Meeting last week to question the assumption that is “universally taken for granted that commission based remuneration leads to commission bias”.
Leighton told delegates his panel has not seen any proper and reliable evidence of this and is likely to join the growing list of organisations commissioning research on the potential effect to consumers of the RDR reforms in the coming months.
The Smaller Business Practitioner Panel chairman Mark Rothery was far more muted in his RDR comments suggesting he will “take soundings from various interested trade bodies before deciding how best to position itself on this difficult and emotive issue”.
Rothery said that enough had already been spoken about the RDR but considering the potential effects of the review on small firms hopefully it will be at the top of the panel’s agenda in the coming months.
Nearly a month after the RDR has been published and the battle lines are becoming clearer with the ABI firmly setting out its stance.
The trade body will be commissioning research in an attempt to reinforce its arguments but has suggested that commission-offset should be banned for anyone holding themselves out to be professional financial planners, or independent, and that the general financial adviser category should disappear within the next few years.
The objective would be to push the importance of the primary advice channel, as well as ensuring there is a total break between commission and advice at the top end, but IFA Promotion chief executive David Elms warns the dual move would kill off consumer access to independent advice.
The battle to provide faster and more generous payouts to victims of occupational schemes that collapsed before the Pension Protection Fund was set up ended mostly in failure last week.
The Commons voted again to reject an amendment that would have set up a lifeboat fund to provide more financial support to victims and an emergency loan to ensure payouts are received ASAP.
As the amendment concerns a financial matter the Commons has primacy on the issue and the Parliament Act ensures that the House of Lords cannot continue its opposition to the Government.
The Government announced more help for victims, pledging to match the extra support that can be gained through making better use of scheme assets to raise payouts from 80 to 90 per cent of expected core pension.
But campaigner Ros Altmann says due to the bureaucracy of the Financial Assistance Scheme and the time taken for schemes to wind down many pensioners who are in desperate need of help are not receiving payouts quick enough.
The Young Review has identified around £1.7bn in assets available in schemes qualified for the FAS with additional value possibly generated by bringing these assets together.
Altmann says that considering these facts the Government could sanction an emergency loan safe in the knowledge that the money is there to repay it.
She says that waiting for the final results of the Young review as well as relying on the FAS will continue the suffering for many pensioners.