OpinionAug 13 2015

Help shape the future

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Help shape the future
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“Speak now, or forever hold your peace.”

This is a phrase more commonly associated with weddings; however, right now it applies directly to the financial advice market, and to IFAs in particular.

There are currently two critically important issues pending, about which you have the chance to provide valuable input. If you fail to seize the opportunity now, then it will be no good complaining afterwards – it will simply be too late.

The first is the Consultation Paper on Pensions Tax Relief issued by HM Treasury. This important document gives you the chance to have your say on the future shape of pensions tax relief.

The notion that high rate tax relief will end is essentially a foregone conclusion – even ministers are said to have urged people to take advantage of the relief before it disappears. The real issue to be addressed, however, is how we encourage the vast majority of people to save for their pensions. This is even more important now that the new pension freedoms give access to pension savings at 55.

The notion that high rate tax relief will end is essentially a foregone conclusion

The second, and frankly a much more important matter for the future of the IFA sector, is the announcement by the Treasury of a major new financial advice market review. Yes, just when you thought things were settling down, we are now faced with yet another major review.

Launching the review, the City minister Harriet Baldwin said that it would “explore what more can be done to make sure consumers can access high-quality and affordable advice, so they can make informed decisions with their hard-earned money”.

Personally, although we could do without the disruption, I welcome this review as it is both wide-ranging in topic and short in length. The intention is for it to be completed in time for any changes to be in the Budget next March, less than nine months away. Very importantly, the issue of (over) regulation is to be examined for any unintended consequences which may damage consumers’ access to advice.

Indeed, not only are these issues critical to IFAs now, but they are going to be hugely important going forward. So I urge you to act now. Downloading the terms of reference from www.gov.uk, and make your views known. This is particularly vital at this initial evidence stage, as the review will then be narrowed to a much more limited consultation paper.

Ken Davy is chairman of SimplyBiz