Your IndustrySep 19 2014

Relief among advisers on Scottish ‘no’ vote

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Financial advisers have expressed relief upon waking to a ‘no’ vote to Scottish independence, admitting that a ‘yes’ would have created a barrier to business and an unknown and unpredictable framework in which to advise clients.

Speaking to FTAdviser, Scottish-based advisers and peers south of the border admit that while some opportunities would have appeared, the no vote means it is business as usual.

Graeme Inglis, founder and director at Kirkcaldy-based Create and Prosper Financial Services, said that it is a relief as the vote has proved to be a barrier to doing business.

“Many clients have held back from making decisions and as a business in the event of a yes vote we would need to have reviewed the structure of our business. Hopefully we can all get back to business as usual and focus on the way forward.”

Carl Melvin, certified financial planner at Renfrewshire-based Affluent Financial Planning, shared this sense of relief, noting the numerous unanswered questions on the implications for IFAs.

“There was no clarity on regulation and how this would be different, how it would be funded and cross border issues. How would a Scottish [Financial Services Compensation Scheme] be funded; are there enough Scottish firms to make the numbers work? How much would it cost? The same for the [Money Advice Service] and the [Financial Ombudsman Scheme], etc.

“It’s not credible to expect people to vote yes without giving detail on what the consequences will be – naive to expect intelligent people to go with ‘it’ll be alright on the night, trust me, I’m a politician’.”

Colin Rodger, director of Edinburgh-based Alexander Sloan Financial Planning, said that IFAs prefer to have a predictable framework in which to advise clients.

“A ‘yes’ vote could have created uncertainty in many areas, with key issues such as the currency and EU membership to be resolved.

“That could have taken a long time so we would not have had that predictable framework. That in turn would have made our job more difficult.

“For us as a business the prospect of a whole new regulatory structure being created, and the possibility of having to be regulated in Scotland and the UK did not appeal.”

These sentiments were shared by peers south of the border.

Patrick Connolly, certified financial planner at Chase de Vere, said: “For financial advice firms, while there could have been some opportunities created by a yes vote, the no vote result means it remains very much business as usual for those with advisers and/or clients in Scotland - of which we have both.

“It will be interesting to see what further powers are devolved to Scotland in the future and, as a result, whether any changes might mean that aspects of the advice we give to our Scottish clients differs to the advice we give to our clients in the rest of the UK.”

Daren O’Brien, director at London-based Aurora Financial Solutions, added that it was only in the last week that there was any indication that the result would be anything other than a ‘no’ vote.

“We therefore only just started to worry about the exchange rates and the funds our clients currently hold. It would have been interesting as quite a few older insurers are Scottish or have ‘Scottish’ in their name and this would have impacted our future advice regarding existing products already held by clients.

“I believe it won’t impact our advice immediately until we hear exactly what the UK government will now offer to Scotland and the No supporters. I’m sure there will be new funds/Ucis offerings looking to now invest in Scotland and take advantage of the extra government money potentially going up there.”

Robert Forbes, chartered financial planner at London-based Plutus Wealth Management, stated that very little will change and it was “one errant opinion poll” that prompted a reaction from Westminster in the last seven days.

“I expect the markets will have a brief moment of elation but then remember that there are many global troubles to be worried about.”

Susan Hill, chartered financial planner at Susan Hill Financial Planning, added that while she was happy at the result, the status quo is unlikely to be maintained for long.

“I think we’ve found out too much about how central government funds have been allocated and English regions will want a greater share.”