Lord Flight renews call for delay to avoid RDR ‘chaos’
Former MP says refusal to allow grandfathering is “hypocritical” as regulators do not need to take exams.
Lord Flight, the Conservative former shadow chief secretary to the Treasury, has called for the Retail Distribution Review to be delayed and has warned that without a delay “there will be a period of chaos” for most of the industry.
Writing in a blog post on Conservative Home, Lord Flight, now chairman of Flight & Partners Recovery Fund, also questioned the Financial Services Authority’s recent announcement stating some financial advisers will be able to get a waiver of the deadline if they are not ready in time.
He said: “This approach only adds more uncertainty and more cost to a process which has been flawed from the outset. Under what conditions would the FSA offer a waiver? Are such waivers to be issued equally? Does the FSA still have the manpower to implement what could be several thousand such requests?”
Furthermore Lord Flight says he “cannot see” why the regulator refused to “grandfather” individuals who have been practising for over 20 years. He said this was a “hypocritical move” by the FSA, as those who work there are not required to take an appropriate examination to qualify to be regulators.
He also highlighted the Treasury Select Committee’s call for a year’s delay in the implementation of RDR, adding that the one-year wavier would have allowed more time for those still attempting to qualify whilst allowing more thought to be given to the transition.
He said: “Much of the historic financial advice industry in the UK will be destroyed with major job losses. If the 1 January deadline is not delayed, for the industry at large, there will also be a period of chaos which will benefit no one, and especially the consumer, in whose name this policy has been created.”