The Financial Services Skills Council has warned that the RDR will fall short of its objective of achieving good consumer outcomes if not enough advisers remain in the industry.
It says it continues to support the move towards professionalism but is wary that the RDR will trigger an adviser exodus and a potential shift away from advice for the mass market, resulting in consumer detriment rather than benefit.
Director Sarah Thwaites says: “All of us would agree that a more professional approach can only be of benefit but let us not lose sight of the consumer in all of this. The danger is that if too few existing advisers meet the new qualifications level or the industry does not find it cost-effective to offer advice to the mass market, the very important aim of achieving good consumer outcomes may be lost.”
The FSSC was instrumental in drawing up the standards for the core units of the QCF level four qualification.
Technology & Technical director Kim North says: “The FSSC set the RDR standards through exams, yet it is effectively saying the industry will be decimated because advisers cannot get through its own exams. It is bizarre for the FSSC to be commenting like this.”
But Evolve Financial Planning director Jason Witcombe says he believes the FSSC has a valid point.
He says: “Part of the RDR’s focus should have been to engage more people with personal finance advice and I think that objective has been missed. If the RDR was coupled with some sort of initiative with workplace advice that would have been fantastic but unfortunately the RDR has ended up being a bit one-dimensional.”