The concept of generic advice has been championed by countless public bodies, MPs, providers and organisations such as the Resolution Foundation as the silver bullet to the advice gap and as way of encouraging low to medium earners to save.
The influential group of MPs strongly support the concept of a generic advice network but the report says the FSA needs to develop a clear definition of generic advice that differentiates it from regulated advice.
The MPs say ‘particularly careful consideration’ needs to be given to the extent to which information gathered through generic advice can then be relied upon by a regulated adviser.
The committee also calls on the Government to clarify how such a scheme could be funded, and if there should be any sort of charge – something the MPs are against.
Aegon has been one of the leading voices of how Government subsidised generic advice could be integrated into IFA practices, particularly around the issue of personal accounts.
The provider sees a potential role for advisers in this area by setting up a generic advice arm and believes a set of advice focusing on basic affordability, debt management, benefits and investment risk can be provided through a Government-subsidised scheme.
Economic Secretary to the Treasury Ed Balls is due to outline his 10-year financial capability strategy alongside next month’s pre-Budget report and there is considerable pressure on the Government to commit a large amount of funding to this area.
The PBR will also contain the Government’s final decision on Asps, with the industry frantically racing to convince the Treasury to allow some kind of annuity freedom, and more meat on Balls’ recent Isa announcement.
Gordon Brown’s last PBR speech takes place on 6 December and will be used by the Chancellor to set out what life under a Brown premiership will look like.
Some forecast an olive branch to middle England in the form of an income tax reduction or rise in IHT threshold and more atttempts to woo back the City in terms of tax simplification to go alongside the much trumpeted attempts to cut red tape.
Elsewhere the FSA continued its recent speech salvo with a warning from managing director Clive Briault about issues of affordability surrounding mortgage advice and a further speech at the BBA setting out the regulator¹s agenda for 2007 and potential trouble ahead for banks and lenders as the economic climate becomes less benign.