PFS: 2013 the year of ‘consumer endorsement’ of advice

In many ways 2013 might be remembered for being less eventful than many had expected, according to Keith Richards, chief executive of the Personal Finance Society.

Mr Richards said pre-Retail Distribution Review predictions that adviser numbers would be decimated and indeed continue to haemorrhage throughout the year as consumers walked away in droves because of the visibility of more transparent charging structures failed to become a reality.

The reality of 2013 was quite the opposite and instead, he said, the last 12 months should be remembered as a year where the financial planning community evolved into a profession.

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Mr Richards said: “The achievement of so many in obtaining higher levels of professional standing and implementing new regulatory rules is a major milestone and testament to the quality of the people who remain in the financial planning sector.

“2013 was also the year of consumer endorsement of advice, where the predicted mass exodus did not occur, showing just how much existing clients value and trust the service and relationship they have with their financial adviser or advisory firm.”

“The introduction of the new regulatory framework, separating powers between the Bank of England, Prudential Regulation Authority and Financial Conduct Authority has also been a change of significance, according to Mr Richards.

He said the new regulators were delivering better outcomes from than those of the past.

Mr Richards said: “The FCA in particular is making a great effort to engage more constructively with the sector, and in our direct dealings with them they continue to be open, balanced and pragmatic in their approach.

“The FCA’s direct involvement in delivering guidance and continuing professional development, via various forums and the Personal Finance Society’s own regional programme of events, provides more advisers with an opportunity to interact directly with the FCA throughout 2014.”

Mr Richards revealed 2013 had been a good year for the Personal Finance Society’s membership, which continued to grow throughout the year to about 34,000, and the number of statements of professional standing issued by the group stands at more than 21,500.

He said: “Many members have shown their desire to continue studying past the regulatory minimum of QCF level four, with Chartered membership continuing to grow to just under 4,000 Chartered financial planners and 550 Chartered financial planning firms.

“In addition to building on our programme of broader, business-relevant CPD support for members, we will continue with our public interest focus, and have formed a new consumer panel to help us better understand how to deliver a more balanced message to the public regarding the benefits of receiving professional financial advice.

“With an increasingly ageing population the need for a professional financial review will become more apparent to thousands who near and reach retirement and it is incumbent upon all of us to provide educational information that will better inform the public and help them make the right decisions.”