Alliance Trust signals ‘frustration’ at platforms RDR delay
Platform warns that advisers going into next year will be looking for services that are “set up for the new world”.
The move to the Retail Distribution Review should be done in a single thrust and platforms should not be given a 12-month deadline extension to ensure they are they can comply with the regulator’s unit rebates proposal, platform operator Alliance Trust Savings has said.
In an interview with FTAdviser, Patrick Mill, newly appointed managing director, said that it was “frustrating” as from Alliance Trust Savings’ perspective 1 January was the date that the industry would be moving to the Retail Distribution Review.
He said: “So why aren’t they sticking to the date? I would imagine that advisers are slightly frustrated that adviser charging is coming in but the platforms don’t have to go transparent for another 12 months. It should have gone altogether.”
The Financial Services Authority has proposed in its platform consultation paper, CP12/12, to ban cash rebates and replace this with unit rebates. It was also proposed in the paper for platforms to have until the end of 2013 to get their systems in order to facilitate this.
Brian Davidson, platform proposition manager at Alliance Trust Savings, added that there is a “danger” that if platforms do leave it until next year to facilitate unit rebates, they may lose adviser business.
He said: “Advisers are in the new world from next year and we think they will then want to move to using providers that are also working on that basis, because if they don’t and then there are changes, they will need to explain those changes to their customers and they may have to move from one model to another.
“Advisers going into next year will be looking for platforms that are set up for the new world.”
In its response to the consultation paper, Alliance Trust Savings, like Novia Financial, said that there should not be any rebates at all.
Mr Mill said: “Platforms should have clean share prices with no rebates at all and the adviser charge and the platform charge should be explicit.”