This month has seen the first Conservative government Budget for 20 years. While the headlines focused on the reduction in welfare and the new national living wage, sneaking into the small print was also a very important consultation paper from HM Treasury on pension tax relief.
The consultation is open until 30 September. I will share my thoughts with you in a future column but until then I would encourage you to read the document and consider your own response.
The Budget also announced the replacement of student maintenance grants. Although education is devolved to the national assemblies and parliaments, so the impact will be different across the UK, we should not lose sight of the wider UK picture. Higher education is one of our major export success stories, and as we strive to retain our world economic ranking, our universities are at the forefront of educating the next generation of UK businessmen and women, as well as educating many of our future overseas customers.
This month around 400,000 students will graduate with a bachelor’s degree or equivalent, and many of them will be attracted to a career in financial services. Indeed in London over 60 per cent of the workforce are graduates, and despite the rising costs of higher education the enthusiasm for a university education continues.
Yet this drive also increases pressure on the graduates to ‘talk up’ their achievements. In my column a few months ago I mentioned how easy it was to fake academic success and why businesses needed to be extra-vigilant when recruiting, and this subject certainly has attracted interest from readers. It is not just individual assignments that can be purchased but also full qualifications – including all types of degrees. Doing some quick internet research for this article, I could not believe the sheer audacity of some of the publishers of fake qualifications. One even produced ‘cloned’ degree certificates and transcripts that looked identical to the real thing, including many from respected British universities. I am also aware of one individual who actually gained a genuine university degree but then substituted his real degree certificate with a fake one showing a higher classification. It was only when a check was made with the university that the fraud was discovered. If this sort of thing were to happen in our industry it would be a serious problem going against FCA rules and the professional bodies’ codes of ethics.
The message is simple – when recruiting, whatever the level of qualification presented, check it out. If someone is prepared to lie about their qualifications what else will they lie about?
Finally, I would now like to turn to ‘pricing policy’ for advisory businesses.
I am often asked what a good pricing model looks like and I always reply that this must be client-focused but still profitable for the business. A good comparison for me is cars. I drive a Mitsubishi Outlander. I love the car, and overall it is good value, but not all of Mitsubishi’s pricing policy is customer-focused. One annoying issue, that is alas common with other manufacturers, is the factory-fitted satnav. My main gripe is not the quality of Satnavs, but the cost of map updates. When I bought my previous car I avoided a built-in satnav and instead purchased a Garmin for less than £130. This came with free lifetime map updates.
When buying the Mitsubishi I did not want their satnav, but the model that I selected had it as a standard. In fairness, it is a nice display and the map technology is actually supplied by NAVTEQ (now called HERE and owned by Nokia) who also supply Garmin. So why am I upset? Well, the maps are now out of date and it will cost me £149 every time I want an update. That is more than the cost of a new Garmin satnav with free updates.
So when I am asked about my car I say how nice it is, before spending a greater amount of time moaning about the poor value of the satnav. So, ask yourself this question: “Does my pricing policy offer good value, particularly with regard to ongoing service, and how do my clients perceive it?”
Dr Peter Williams is an independent business consultant and chartered financial planner
