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Tories in plans to remove regulatory millstone

The Conservatives are looking to draw up radical proposals aimed at lessening the regulatory burden placed on advisers.

John Redwood, MP, who chairs the Tories’ economic competitiveness policy group, says a combination of too much regulation and the fear of future reprisals has produced “particularly undesirable results for the IFA community”.

Speaking at a meeting with the IFA Defence Union last week, Redwood said drastic measures are needed to deal with the extreme growth of regulation, much of which he claimed is unnecessary, self-defeating and contradictory.

Wokingham MP Redwood said he has been deluged by a “Niagara” of correspondence from IFAs since the policy group was formed but it is time for advisers to come up with solid recommendations to remove barriers.

He said the regulator’s main job should be to protect the public from predatory businesses, with areas such as best advice and appropriate products “very much a sec- ond-order issue”.

Redwood said that by expending so much energy trying to protect the public from themselves, the FSA is getting in the way of many people looking for advice and caveat emptor has “a lot to recommend it”.

He said a Tory Government would not dismantle the FSA, as it sees no need for a raft of complicated legislation and “institutional architectural destruction”. But he said the Conservatives will be working on an radical agenda focusing on further differentiating retail and wholesale regulation and investigating adviser regulation in other countries.

The economic competitiveness group will report next July but is looking to start formulating a series of concrete proposals from early next year.

Redwood said: “I do think we need something radical to deal with the extreme growth of unnecessary regulation which is sometimes contradictory and self-defeating and damaging to IFAs.”

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