The regulator has launched its business plan for the next tax year, giving an idea of its priorities for the next 12 months.
Retail investments is one area where there will be planned work. The FCA will continue to review due diligence of financial advisers and will look into continuing to identify the risks in the way firms are offering contracts for different products. There will be a market study into non-advised sales of investment and protection products. The plan states, “We want to see how consumers behave when they are making their own investment decisions and how firms support consumers in choosing products that are suitable for their circumstances.”
Pensions and retirement income is another major area that will be under scrutiny over the next year, particularly now the retirement freedoms have come into place (see page 9 for further details).
The pensions industry has seen considerable change over the past 12 months, and it is sure to continue. The FCA says it will review how retirement sales practices of pension providers – in relation their their vesting customers – have changed. Particularly how firms are supporting customers to make the right choices given the wider range of options available. One of the key objectives is to ensure that firms have “stepped up” and improved practice since the publication of the FCA’s thematic review in December.
Andrew Pennie, marketing director at pension and retirement planning specialists Intelligent Pensions, said, the focus on retirement outcomes must present opportunities for all advice companies, whether in-house or using outsourced solutions. “I do believe the advice industry will be the long-term beneficiaries of the new pension freedoms. By demonstrating good client outcomes and value for money, they will help to rebuild consumer trust and make advice the ‘go to’ solution for retirement planning.”
The regulator is planning a review into how well the market is working now the reforms and the guidance guarantee have been introduced, expected to be completed by early 2016.
