Tory peer attacks FSA over RDR access to advice
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Conservative peer Lord Howard Flight has warned the RDR will result in advisers losing interest in serving clients with less than £100,000, and attacked the FSA for failing to understand people are not prepared to pay for advice.
In a letter to the Financial Times this weekend, Flight (pictured) says the FSA is “hell bent” on the RDR’s commission ban, despite the detrimental effect this will have on access to advice.
In the letter Flight says: “The rich will be affected little; they have the resources to pay for advice.
“But financial advisers will not be interested in those with savings of the order of £100,000 or less who I doubt will be willing to pay fees out of after-tax income, of the order of 1 per cent or 2 per cent per annum. The net result will be many fewer people getting any financial advice.”
He suggests a better approach to financial advice reform is what is happening in Germany, where IFAs are allowed to opt out of a commission ban with their clients’ permission.
Flight adds: “The problem with the Treasury and the FSA’s elitist attitude here is they do not appear to understand ‘the man in the street’ is not willing to pay what would be significant regular fees out of after-tax income when frequently no changes are being made to their holdings.
“The message is clear – give up bothering to save.”
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Readers' comments (9)
Phil Renwick | 20 Aug 2012 10:56 am
Too Late! Why has it taken so long for someone with some political clout to realise that the ordinary man in the street will be the hardest hit by RDR
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Swanny | 20 Aug 2012 10:57 am
Where has this guy been?
Probably not had his name in the press for a while.
WAKE UP
We have been saying this since RDR started.
God help us!!!!!!!!!!!!!
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Colin Linscott | 20 Aug 2012 11:00 am
Clearly Lord Flight has an understanding of the result of RDR, it will not matter what he says the FSA will continue in their usual blinkered way. It beggars belief that after so many failures the FSA still exists let alone is allowed to continue witch hunting the IFA community when they only account for 1% of complaints.
If it aint broke dont fix it!!!!
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Anonymous | 20 Aug 2012 11:04 am
Too late old chum!
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Anonymous | 20 Aug 2012 11:22 am
Stables and horses I think !
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Ian | 20 Aug 2012 12:04 pm
Does anyone know who Howard Flight is? Co-founder of Guiness Flight and subsequent merger with Investec? You know what they say.....when an Englishman is upset........ he writes a letter.......must have had a tough day in the house with only a couple of hours sleep......
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James Barr | 20 Aug 2012 12:18 pm
nothing new here everything that the government touches turns to dust
Basically they are promoting their own self destruct
culling the savings culture both in short term and long term areas
the perfect storm will come when old mother hubberds cupboard is bare
and as usual its the ones paying tax that foot the bill for all the spongers in government or otherwise
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Glen McKeown | 21 Aug 2012 0:57 am
Have pity on the man - he has been indulging in that wonderful FSA pastime - looking the other way until it is too late.
And, like the FSA, he won't bother too much either.
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Anonymous | 24 Aug 2012 2:38 pm
Pathetic really, isn't it!?
If I was him I would re-negotiate the 1% or 2% annual fee that his financial adviser must be considering charging him.
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