FSCS should not spend your money on vain self-promotion

Worst of all, I am told, these are bills footed by good advisers to pay for costs incurred by the bad.

I have always disagreed. To me, advisers meeting these costs should be a badge of honour rather than a source of whingeing. Mas may be a long way short of perfect, but it is an attempt to address the real problem of an advice shortfall.

Similarly, the Fos and the FSCS both exist to ensure fair treatment of the consumers we are all supposed to be there for. The huge majority of IFAs do wonders for clients, but the fact you all collectively contribute towards helping the handful that are let down by their advisers – or, more often, providers – is to the benefit of all your reputations.

The fact is, some advisers do cause problems and it is to the good of the profession as a whole that financial planners contribute towards fixing them – and are seen to do so.

While I believe you should fund these organisations, I am convinced in return they should be transparent and open to scrutiny when it comes to how they spend their money. Sorry, your money.

Every penny should be accounted for and go towards extending whichever principle of fairness they exist to promote.

Every penny should be accounted for and go towards extending whichever principle of fairness they exist to promote

Recently, while skimming through the Daily Mail website, in between trying to identify any of the celebrities and seeking guidance from younger members of the team as to whether I should declare myself to be Team Harry or Team Zayn, I stumbled across a fairly bland profile of the presenter Fearne Cotton with a prominent FSCS logo stamped upon it.

I soon twigged that the FSCS had sponsored the placement of an article, although what was not so immediately obvious was why.

I read the article several times, trying to find an angle that benefited the FSCS, never mind the broader financial services industry. There must be some advantage for advisers hidden in the revelation that Fearne was wearing “a huge fluffy green jumper, a pair of skin-tight leather trousers and a purple trilby”, or that “she makes a mean banana cake”, I mean why else would the FSCS be spending your money on advertising these facts?

Tucked away in the piece was one throwaway line about Ms Cotton supporting the FSCS’s ‘Protecting Your Future’ campaign, which ‘aims to help people become more aware that their money is protected’. But then it was back to family holidays and knitwear.

To be fair, the puff piece was part of a sponsorship of the entire personal finance section of the site. The Fearne Cotton interview was a particularly jarring example of how this was implemented, but the plan was obviously to attach the FSCS’s name to a range of articles about all areas of personal finance.

But even if the other articles are more relevant, I am not convinced that advertising itself alongside anything with any link to personal finance – however tenuous – serves the interests of the FSCS.

The FSCS provides a valuable service to anyone whose investments have failed through no fault of their own. But this inherent fairness of being available to all is what renders the campaign redundant. Individuals do not need to sign up for it, so why advertise it?

Product providers should make individuals aware at the point of sale. Even better, tell them about the existence of the available compensation – and how much they are entitled to – when their bank is going under. They are more likely to listen then, when there is a real incentive to find out how to claw back some money.

Why not do both? It would be more effective than hiring a vapid presenter with several dubious exes in the hope people stay awake long enough into her eulogies over Stella McCartney’s chunky knits to hear the nugget of information you are trying to relay.

It would be cheaper too. Buying such a huge chunk of space on the most popular newspaper website in the English-speaking world must have a price. And I’m sure Fearne Cotton charges a fair whack for her time. Purple trilbies don’t come cheap after all.

If the FSCS must use its funds to promote its own existence rather than, say, to compensate people, I can’t believe this is the most effective way to do it.

Even if some do read the article, most who see it won’t. And those that do are already readers of the money pages. By definition, they take an interest in financial affairs and are proactively trying to find out more by visiting the money sections. Surely it would do better to try to reach those people who have no interest in money, who are less likely to already know about the FSCS.

Or it could use its advertising budget to drive some of these people needing help towards advisers. You know? The people who pay for the ads in the first place?