ifa reported in February that the UK industry is experiencing an “advice gap” as a result of adviser losses following new industry reforms, including higher education standards.
In a statement, the Financial Conduct Authority (FCA) said its Financial Advice Market Review (FAMR) found a need for “intervention” by the regulator and government both to help consumers and the industry benefit from cost-effective ways of delivering advice.
These recommendations include narrowing the definition of “regulated advice” and removing some of the barriers that exist for firms wishing to offer guidance services. The report also highlights the role that technology can play in offering cost-effective advice, and recommends that the FCA establish a unit to help firms develop automated advice models.
Further, FAMR calls on the government to allow consumers to redeem a “small part” of their pension pot against the cost of pre-retirement advice. This is intended to ensure that consumers can access advice as they approach retirement.
“FAMR builds on improvements made to the financial advice industry brought about by the Retail Distribution Review (RDR) which raised the standards of professionalism across the financial advice market,” the statement said.
“FAMR outlines practical ways to enable consumers to engage with and access advice and guidance, urges changes to how financial advice is defined and suggests a new advice framework to help firms best meet the needs of consumers.
“The report makes a range of recommendations aimed at ensuring firms are able to provide more affordable advice for more consumers.”
FCA acting chief executive Tracy McDermott said: “The package of reforms we have laid out today will help increase both the accessibility and affordability of the advice and guidance to ensure that consumers get the help they really need when they really need it.”
I am curious about the compliance regime in the UK but it can’t be much more over the top than the Australian system whereby clients are provided with information they don’t need or want by licensees scared of being sued for leaving something out of an SOA. They system in Australia is already at a point where it is difficult to provide advice to your “standard working class couple” and this will only worsen in the next few years. The only issue is that it will be left up to the bureaucrat’s who don’t don’t undersand the industry or the processes to design an easier system for receiving advice after making the system too complex previously.
None so blind as those who will not see. There is an agenda at work that every adviser has the vision and ‘coal-face’ knowledge to point out. Those with the agenda are asleep at the wheel and will NOT even notice these precedents, but will blindly force this outcome on the population so that in 5 years time we can read the same headline, but only this time, it will apply to Australia.