What kind of financial advice do consumers want?
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It will also be asking if there is an advice gap – which there certainly appears to be – how can it be closed?
The review aims to improve the availability of advice to people, particularly those who may struggle to access advice because they do not have significant wealth or income. The review is being led by Charles Roxburgh, Director General, Financial Services at HM Treasury and Tracey McDermott, acting CEO at the FCA.
But with recent changes to pension schemes – including automatic enrolment and new pension freedom rules giving savers greater control over their portfolios – expected to boost demand for financial advice, the government announced over the summer that it will conduct a new review with the City watchdog.
Launching the consultation, Baldwin said: “Helping hardworking people achieve their aspirations at every stage of their lives is at the heart of our long-term plan”.
Last week life assurer Partnership’s chief executive Steve Groves told a financial planning conference in Wales that the FCA is set to give the “green light” to robo-advice after the review, the Financial Times said.
Tom McPhail of Hargreaves Lansdown believes there is a gap between what investors want and need, and the services permitted by the regulatory framework.
But Dr Scott said if access to professional financial “advice”, as the public perceive it, is to be brought into the hands of the many, it must be with a guarantee of quality and protection.
McDermott adds: “The financial decisions people make can have long-reaching effects”.
“The review is a chance for the FCA, Government, industry and consumers to work together to ensure we can deliver a market that meets this need”.
The initial evidence gathering will have a broad scope before narrowing down to consider those areas where the advice gap may be most acute.
The consultation will run until 22nd December, with the final report due to be published ahead of Budget.
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The review will also take input from an expert advisory panel chaired by former Scottish Widows Nick Prettejohn, which will include 12 to 15 industry experts from financial services providers, advisers and consumer representatives.
