Old Mutual Wealth chief distribution officer Richard Freeman says:
“The findings and recommendations of the FAMR are good news for consumers and advisers alike and the Review has identified some important issues for reform.
“High-cost and unpredictability in the FSCS levy has become a burden on adviser firms, prohibiting small business owners from investing for the future. The FCA and Treasury have today recognised these concerns and we believe that a more proportionate FSCS levy on advisers will help create economic conditions that allow firms to grow.
“The cost and burden of regulation is also something that advisers tell us can be prohibitive to the growth of their business. Where regulation and regulatory processes can be simplified without consumer detriment they should be, so it is pleasing to see the regulator is prepared to look at reducing the length of suitability reports, making them more relevant and accessible for clients.
“It is also pleasing to see a firm commitment to clarifying the boundaries of advice and guidance. Defining ‘Advice’ as a personal recommendation would be a positive step, giving firms more clarity and creating a line in the sand between advice and guidance.
“Allowing consumers to access part of their pension pot early in order to fund the cost of advice is a bold proposal. It will undoubtedly require careful legislation but if it allows more people to access at-retirement advice then this can only be a good thing.
“Equally, making it more cost-effective employers to contribute to the cost of advice will encourage uptake. The workplace can be the best environment to get people thinking about the need to build a financial plan and improving the economic case for employers to contribute to the cost of advice is positive.
“Perhaps the most important thing though is the overall positive tone regarding the future of the advice industry. The merits of regulated advice are not always clear to the wider public and encouraging a positive rhetoric around the benefits of financial planning is really important. It is really pleasing to see the FCA and Treasury speaking positively about advice and encouraging government to look at ways to nudge people to seek financial advice.”