Speaking at the launch of the provider’s ‘Generation Advice Programme’, its head of adviser propositions and strategy David Tiller shared research which found that 83 per cent of more than 800 advisers have already seen an increase in demand since the 6 April changes.
Mr Tiller committed the company to a rolling programme of developments to support advisers, including ‘systemisation’ of complex processes like asset migration, back office integration, tax optimisation, client income withdrawals, capital gains tax modelling and strategy execution.
Mike Hogg, Standard Life’s head of platform strategy, explained that the firm will be launching a tax optimisation tool in August, to help advisers guide clients through their new options, along with adviser-led investment ‘insourcing’.
“Insourcing is the new outsourcing, it maintains control whilst having specialists managing money on the adviser’s favoured platform, rather than being all or nothing,” he said, adding that the migration capability will be going live soon, following around £200m already having been moved onto the hub during the first quarter this year.
Mr Hogg continued that they were also adopting best policy from the US, in terms of the adoption of withdrawal policies that lay out in what circumstances money can be drawn down from pension pots.
He mentioned that in adviser discussions, 95 per cent of them were unaware of this as a possibility, but that it could vastly improve portfolio sustainability and make a real difference in tough markets, without huge technology investment or great expense.
Standard Life will also include a back book client safety net, providing an ongoing non-advised service to clients where full advice is not economically viable.
Also present at the launch was Carl Lamb, Almary Green managing director, who said that while advisers were seeing opportunities from those with large and small pension pots, the danger was in the middle ground.
He stated that if people do not want to go through the full advice process, they simply will not talk to them, given “insistent client fluff” guidance from the regulator and having one eye on professional indemnity insurance.
Earlier this month, the Financial Conduct Authority said that advisers were free to give advice to so-called ‘insistent clients’, but advisers must make it clear to the clients - and document it - the risks associated with the alternative course of action and that the client is acting against your advice.
Mr Lamb said: “We introduced a minimum fee of £1,500 to price out the bottom of the market, we’re already at capacity and don’t want any more clients,” commented Mr Lamb, adding that without more work to meet demand for at-retirement advice, this could be a mis-selling “disaster” that makes “PPI look like a walk in the park”.
Mr Tiller said that tackling this potential problem was a collective industry responsibility and that Standard Life would be working much more closely with advisers from now on, “no longer just throwing products over the fence”.
He added that the Generation Advice Programme and plans for Standard Life’s new 1825 advice business will address the capacity gap in different ways.
“In 1825 we are looking to develop a nationwide advisory business. As part of this initiative we are planning to train advisers and bring new talent into the industry - given the size of the capacity gap it is important that adviser numbers rise,” said Mr Tiller.
“However, training new advisers takes time and the capacity challenge is substantial. Generation Advice looks at how we can help all adviser businesses realise greater efficiencies and reduce the risks associated with the delivery of high quality retirement advice.”
Earlier today, Royal London renewed its call for an urgent review of advice rules to enable a ‘cost-effective’ advice option for savers looking to cash-in modest pension pots, after official data were published showing that savers have taken £1bn from pots since April.
Phil Loney, chief executive of Royal London, said an advice regime is needed that enables customers to make informed decisions when accessing their pension funds.
Yesterday (16 June), chancellor George Osborne revealed in the House of Commons that 60,000 people have made use of the pension freedoms since they came into effect in April, who have collectively transferred £1bn out of their pension funds.
peter.walker@ft.com
Additional reporting by Donia O’Loughlin
