The FSA has struck a conciliatory note on the retail distribution review and said it is in listening mode.
In answers to questions at the Tax Incentivised Savings Association Conference in London last week, director of retail policy Dan Waters said the regulator does not plan to change the market overnight.
Waters said: “I can see why this is all a bit overwhelming. It is a significant set of proposals.
“If I could reassure people, we will not rush to judgement, bring the curtain down on what is happening now and start everything new in a year from now.”
He said there needs to be a debate about the length of any transition period and asked whether primary advice is really advice although he defended the FSA’s decision to open the debate with some lead ideas from the industry working groups.
Waters said: “There was a strong consensus around the proposition that professional standards needed to be raised. There is a very real issue about how to get there and how long to take.
“There is a question about transition in the area of capital requirements and further work to do about primary advice. Is it really advice is an interesting question.”
“We are listening mode and you can see how these ideas are morphing as the discussion goes on.”
Talking about Europe’s role, he said that in the areas covered by the RDR and treating customers fairly, policymaking is being driven more and more in a prescriptive way by Europe.
Waters said the regulator is aiming to cover issues not covered by Mifid due to the UK market’s unique character. He admitted that the regulator is constrained by Europe but said it is not looking for massive numbers of exemptions.