This reflects badly on the state of our sector’s relationship with the Government. Relationship management is very important and its absence is best reflected in some correspondence my firm is having on the topic of contracting out.
Scottish Mutual has told us that all remaining personal pension plans that are contracted out will be contracted back in unless they hear otherwise (the much derided inertia option). If the clients have questions, we are then to assist. We were never consulted on what amounts to pro bono work of this type, nor has Scottish Mutual accepted liability for this advice.
I say advice as moving someone back into the state earnings-related scheme will see their letter as exactly that. As the ombudsman would tell them, you might not think it is advice but what really matters is what the client thinks. If they see it as advice, that is what it is.
I really resent this pseudo-advice from providers who are stupid enough to believe that the TCF rules are for someone else. Since it was taken over by a Zombie fund, Scottish Mutual’s service has been on a downward spiral. Hopefully this will alter under Pearl, which takes a contrarian view of TCF.
As we all tend to agree that providers will reduce in number, this inferior service will become endemic and this will be a major challenge for the regulator.
This incident and others like it underline the remaining ignorance that exists about client relationships. We are the clients of the providers, the policyholders/planholders call them what you will, are our clients. Is this so difficult to grasp or do some of our number confuse the issue?
To me, the key success following the retail distrib-ution review will be the separation of advice and implementation. Sadly, that separation will reveal that many who argue for the status quo are keen for that distinction to remain blurred.
Sandler was correct. Advice is not picking a product that is the equivalent of a personal shopper. I know that the IFP has suggested a financial guide but, for me, that is not clear enough.
Let’s avoid new terms and stick to those the client understands, hence my use of personal shopper. All terms need to align with current terms and not be unrecognisable or not in common usage. We need titles that reflect what people do, not what they use as a brand.
This means auditing what goes on, if you like, mystery shopping with a robust structure. To date, we have focused on minutiae and not on the big picture.
I remain concerned that we focus on what people are capable of doing instead of considering what they are doing. We need to provide what we promise, not what suits us.
Someone is bound to remark that I failed to recognise that John Tiner, late of the FSA, had been awarded the CBE. As I recall, this award is also held by Billy Connolly and Bruce Forsyth and this award would seem to go to those with talent. I for one regret him leaving the FSA as he had made real progress.
Let us hope that his successor can make the difficult decisions and take us forward and not remain static as some would like to see. All the best to you for 2008.