Three-quarters of experienced advisers have left the industry since A-Day’s pensions simplification regime came into force in 2006.
A Freedom of Information Act request from FTAdviser revealed there were 105,710 regulated financial advisers as at 1 January 2006.
This meant when pension simplification - ‘A-Day’ - came into force in April 2006 and people were given more flexibility over their pension options, there were plenty of advisers able to help them.
Ten years later - a period which saw the Retail Distribution Review introduced in 2012 and some advisers seeking an exit to avoid the stricter regulations - thousands of advisers have disappeared.
An exact comparable figure is difficult to ascertain but according to another FOI request from the Financial Conduct Authority, based on figures at 11 February 2016, the number of level 4 qualified advisers in the UK is 29,144.
Even if the total number of bank, wealth managers, discretionary and other investment managers were taken into account, figures from the Association of Professional Advisers in 2015 estimated there were 31,153 advisers in the UK.
The FCA could not break down numbers of advisers in individual functions within FTAdviser’s FOI request, and the total 105,710 regulated advisers would therefore have included corporate advisers and others not advising in the retail space, so not all of these would have been able to give pensions advice when A-Day came in.
However, even given these caveats, it is clear there would have been more advisers able to help clients with their pensions and/or investments when A-Day came into effect in 2006 than there are advisers available now who can help people post-pension freedoms.
In 2006 there was no CF30 function but there were other designations for individuals giving advice. For example, there was CF24 - pension transfer specialist, CF 21 - investment adviser - and CF27 - investment management.
The CF30 function, as outlined in the FCA Handbook, currently denotes an adviser in a controlled function giving advice on investments, pension transfers, conversions or pension opt-outs to retail clients.
There were also 11,286 firms authorised to give financial advice in April 2006.
As at February 2016, the number of firms authorised by the FCA to give retail investment advice has fallen to 9,955.
With the pension freedoms regime introduced in April 2015 driving people to seek advice, Peter Bradshaw, national account director for Selectapension, said more needed to be done urgently to educate and inform people about their options.
In his response to FTAdviser’s Guide to A-Day 10 Years On, Mr Bradshaw adds: “The pensions freedoms have highlighted pension planning but access to professional advice is limited.
“We believe developments in technology will improve access to advice for those with straightforward planning requirements.”
An FCA spokesman said FTAdviser was attempting to make a comparison between data sets that cannot be compared.
He said: “For example, the 2006 data covers all possible advisory roles, including corporate finance advisors; the 2016 data is for Level 4 qualified advisors only. As an evidence based regulator we believe it is important that data is used properly so people have correct information on which to base their views.”