The “worst effects” of RDR have passed and advisers are learning to operate in the new regulatory environment, Dunstan Thomas managing director Natanje Holt has said.
Ms Holt said: “It is clear that the worst effects of RDR have been felt, and although many predict further falls in adviser numbers, those that are left look set to see rising demands for their services.”
Her comments follow a Dunstan Thomas survey of 105 advisers between 19 May and 4 July.
Some 56 per cent of respondents described 2013 as “a period of intensive business planning and proposition creation and adoption”. Speaking about the post-RDR landscape, 19 per cent they were in “survival mode”, down from 41.4 per cent a year before.
| “Least desirable by-product of RDR” | Percentage |
| Excessive increase in terms and conditions requirements, reporting and other regulatory red tape | 41% |
| Client agreed remuneration | 22% |
| The rise of direct-to-consumer platforms | 20.6% |
Source: Dunstan Thomas
When asked about the largest threat to their business, 59 per cent of those polled highlighted complying with regulations, while 33 per cent focused on failing to gain enough fee-paying business.
Advisers were also worried about the cost of doing business, with 41 per cent saying the least desirable by-product of RDR was the “excessive increase in terms and conditions requirements, reporting and other regulatory red tape.”
According to Dunstan Thomas, some advisers were optimistic. Nearly one-third – 30 per cent – said the largest opportunity for adviser firm growth in the next year would come from “capitalising on capped and flexible drawdown opportunities post-Budget 2014 changes”.
Ms Holt said: “The shake-up in the at retirement world coming out of the latest Budget changes will only fuel demand for sound financial advice, even if it has to be paid for in a more transparent manner.”
When asked to name their top business priority, 39 per cent said it was client retention, while 22 per cent said it was client acquisition.
Adviser view
Adam Palmer, senior partner at Wiltshire-based Financial Themes, said: “It has been a lot of red tape generally, but it’s not that huge for us because we were fee-based anyway. On the pensions side, we have already seen an increased workflow.”
