Accenture told Money Marketing it expects the paper to call for two types of remuneration – fee-based and-fund based – which could lead to increased consolidation in the intermediary market and greater dominance of the banks.
It was also suggested by Accenture that Customer Agreed Remuneration could lead to the mass market losing its appeal for advisers and a takeover of this middle space by the banks who would operate on a “guided sale” regime using generic decision trees to give advice.
The JS&P Towry Law debate is still raging on as Informed Choice managing director Nick Bamford hit back calling for the firm to put their money where their mouth is following chief executive Andrew Fisher’s calls for major industry changes, including the abolition of all initial and trail commission.
In an open letter published by Money Marketing, Bamford asked Fisher to confirm that none of the advisers employed by Towry Law receive commission in any form from new or existing clients.
Fisher stands his ground saying none of his advisers or Towry Law itself takes commission, rather charging an hourly fee and all commission paid out by product providers is returned to the client.
Fisher says he is committed to improving levels of professionalism in the industry but that there are not enough good people yet to warrant calling it a “profession”.
AIFA’s director general Chris Cummings has thrown the issue of the Financial Services Compensation Scheme into the ring this week, expressing concerns that the RDR will steal its thunder.
Cummings says the reform of the FSCS is vital as “the current scheme is inequitable because it fails to apportion costs fairly to those firms which have profited from the business”.
He says: “I hope the FSA maintains its momentum for change and remains on track to meet its April 2008 implementation deadline.” The grass is definitely greener for some with FSA chief executive John Tiner receiving a 14 per cent increase in pay this year to £652,577 compared with £572,619 in 2006.
Tiner will leave the FSA in July but will remain a formal employee of the FSA on full pay until January 2008, meaning he will be paid around £325,000 whilst on gardening leave.
Not everyone is as lucky though – chairman Callum McCarthy saw a drop in his pay package from £436,142 in 2006 to £433,565 this year.
Total executive remuneration for 2007 was up 8 per cent to £2,410,453 compared to £2,216,725 in 2006.
IMA deputy chief executive Sheila Nicoll was appointed FSA director of the retail firms division this week, where she will supervise firms in the life insurance, general insurance and groups of intermediaries from September.
Before joining the IMA Nicoll worked as head of international relations at the London Stock Exchange.
But this week, as advisers expect to see their current business models thrown into disarray and not knowing how they may be paid in the future, they will no doubt look with envy upon the FSA’s staff remuneration packages.