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Treasury proposes widening Catmark

The Government is considering extending its controver sial Catmark standards across the board of financial products.

As part of the Treasury&#39s response to the Cruickshank report, it will carry out consultations on the plans with the industry.

The move has raised fears of a Government-enforced price structure which would restrict choice for IFAs and consumers by forcing companies out of the market because they are unable to compete on price alone. It could leave just five or six big players.

Catmarked standards or kitemarks already exist for mortgages, Isas and stakeholder.

The decision by the Treasury makes it more likely that similar products will be introduced in areas such as investment bonds, life products and health insurance.

The ABI says it is waiting to see what form the Government consultation takes but stresses its Savings and Long Term Risk initiative includes minimum standards for life products.

ABI spokesman Malcolm Tarling says: “We would not want to see Catmarks for the sake of it but we are in favour of products set out in a form widely available to customers.”

IFA Wentworth Rose managing director Philip Rose says: “It comes as no surprise. The writing was on the wall with the aggressive 1 per cent charging structure on stakeholder. This focuses the need for IFAs to offer added value and be able to charge a fee where necessary.”

Pensions & Investment Management adviser Phil Moore says: “Catmarks are supposed to clarify the issues but I am not sure they do. Once again, who is left to sort out the confusion but the IFAs.”

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