There’s not long to wait to find out what the Financial Adviser Market Review (FAMR) will propose to make professional advice more accessible for those with relatively small amounts to invest. The Chancellor, George Osborne, is due to release some of the proposals in his budget speech on 16 March.
At the moment there’s plenty of speculation and a fair amount of controversy, particularly around the suggestion by the co-Chair of the review panel, Tracey McDermott, in a radio interview that there may be a relaxation around commission for certain products.
As Intelliflo has such close links with so many UK advisers, we wanted to find out what they thought about the review, especially the suggestion that commission may return. The results of our questionnaire have just been published as part of a white paper called FAMR: Feast or famine for IFAs? It’s available to download free if you’d like to see the whole thing.
What was interesting was that almost half (44%) of the 203 advisers we surveyed said they are not opposed to a reintroduction of commission. More than a third (36%) said they thought it may be a good idea but it would depend on which products it relates to and how it has to be implemented and almost one in 10 (8%) said they thought it was a very good idea.
Just over a quarter (27%) said they think it is a bad idea and would be a backward step for the image of advisers, while around a quarter (23%) said they were unconvinced the reintroduction of commission would be in the best interests of consumers.
Over half (55%) said they are worried that all the hard work required for the RDR will be wasted should a return to commission be announced in the review.
Asked what they hope the review will recommend, two thirds (66%) said they hope it takes into account how much of a financial burden there currently is for advisers and removes some of it.
Over half (51%) said they hope the review simplifies the way advisers can operate and allows for more flexibility in how advice can be given by advisers and almost a third (31%) said they hope the review creates an opportunity for advisers to expand their businesses.
Naturally there was a fair amount of scepticism about what’s fuelling this review and some pessimism about what the proposals will recommend but overall advisers continue to get on with the day job and regard this review as just another challenge to be met. One thing’s for sure though, if the review recommends reversing some of the changes brought in by the RDR, advisers and providers will be putting their heads in their hands and raising their eyes to heaven.