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The guide divide

We know that a week is a long time in politics so there are no surprises that a generation brings about enormous political changes.

Looking back, I recall that once it was commonly accepted that Labour was the compassionate party, looking out for the poor and infirm and howling with righteous outrage when the Conservatives introduced measures which appeared to favour its middle-class supporters.

No doubt, the likes of Keir Hardie and Nye Bevan would be somersaulting out of their graves if they were witness to the shenanigans and about-turns of recent years. We have been witness to an inexorable encroachment on civil liberties. We have seen assaults on fundamental freedoms and our incomes being raided through both subtle and overt taxation.

Although the Government can remain aloof, financial advisers have been subjected to the whims of the ombudsman which, aided and abetted by the FSA, is secure in its ability to override both the law and the doctrine of common sense and consequently impose its opinions and penalties without recourse.

We have also seen, under a Labour regime, the piecemeal dismantling of the UK personal financial services market and consequently the greatest division between the haves and the have-nots than seen since before Harold Wilson came to office.

Compassion has all but disappeared, with unfairness and a rigid adherence to rules coming to the surface like some foul and rancid confection and, within the financial services market, it is this crisis that the retail distribution review is likely to exacerbate rather than unravel.

Too many individuals who should know better have been applauding the apparent change of tack within the interim report. I wonder how many have actually read and understood the intentions laid down within the report.

Primary advice has not disappeared, it has been sponged down, buffed to an oily sheen and repositioned as guided sales. It has been dressed in unremarkable clothing and sneaked in through the doorway while we stood, apparently vigilant, guarding against the men in black.

Now I have no actual objection to guided primary advice because it is only a symptom of the disease. Treating symptoms never works because while the body often appears healthier, internally it is gradually being broken down.

There are millions of people qualifying for one or more state benefits but, despite exhortations, profound political gestures and publicly funded advertising, they still refuse to apply.

It is the same with life insurance, income protection and retirement planning. Despite our best efforts, the indifferent citizen refuses to take heed.

Now the innocent reader must forgive me as I am homing in on a familiar theme which, despite the possible irritation factor, I will continue pursuing for the simple reason that it is valid.

The unvarnished truth is that the very citizens who fail to voluntarily purchase advice or products are the very people who will voluntarily fail to seek out money guidance, guided sales or indeed advice of any persuasion. These citizens have always existed. The disease they suffer from is not one of recent derivation. Mental lethargy, paucity of commitment and a persistent failure to achieve self-reliance haves been with us for centuries.

As Stephen Vizinczey pointed out in An Innocent Millionaire, “Strange as it seems, no amount of learning can cure stupidity.”

Some horses can never be made to drink but a significant number can be persuaded. In our nanny-led society, the question is, should these citizens be consigned to the second-class offerings of the banks and others who spy profit without glory using the guided primary advice route or should whole of market advisers be enabled to sell solutions while obtaining a profit for their efforts?

Why do I refer this section of the population as citizens? Well, apart from food, drink and Big Brother, they barely consume anything, apart from our time and energy of course.

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