The Solicitors Regulation Authority has apologised over a mistake in its consultation paper on changes to its referrals policy post-Retail Distribution Review, admitting that a cost benefit analysis question should not have appeared as the data included was “too soft”.
Alistair Cunningham, director of Caterham-based IFA Wingate Financial Planning, had highlighted that the paper did not contain information on the cost/benefit implications of the proposals that would be needed to answer one of the questions.
The fourth question on the questionnaire asks if the respondee has any comments to make on the costs and benefits of the options identified in the consultation, but no cost/benefit analysis is provided.
Mr Cunnigham said he was concerned that advisers might not respond to the survey due to the missing information. The consultation, which proposes allowing solicitors to refer clients to restricted advisers from 2013, closes on 10 September 2012.
Mr Cunningham told FTAdviser that he has called the SRA three times in the last two weeks and sent them an email, adding he still has not received a response.
A spokesperson for the SRA apologised for the erroneous question and admitted that previous attempts to alert the regulator to the issue by Mr Cunningham has not been acted upon as it had not been correctly passed on the relevant person.
The spokesperson said: “We were alerted to this on Tuesday. The person who the IFA spoke to did not contact the relevant person to amend this.”
The SRA told FTAdviser that the question should not have appeared on the questionnaire as it is “too soft” and that the paper will be amended.
The spokesperson said: “Our apologies as we decided not to ask the question about cost benefits and analysis. It should have been taken out.
“It was originally one of the four questions but we agreed that it would be difficult to prove and difficult to know what will arise with the FSA’s changes and it would not add anything to our consultation. That form will be amended.”
Under the RDR, many firms currently labelled independent may lose the status because they will not, for example, advise on a sufficiently broad product range.
Under the SRA’s current policy, solicitors can only refer clients to independent advisers. Therefore, the body is contemplating widening its net to allow referrals to non-independent advisers post-RDR.