The Association of Professional Financial Advisers has published a response to the Financial Conduct Authority consultation on the forthcoming secondary annuities market which called for its implementation to be delayed due to Brexit.
Apfa said that the upheaval and uncertainty in the financial markets following the UK’s vote to leave the European Union meant that HM Treasury and the FCA should put plans for the secondary annuity market on hold.
Chris Hannant, Apfa director-general, said: “Now that the UK public has voted to leave the EU, the financial markets are facing considerable uncertainty and upheaval. Financial advisers, their clients and the public have a lot on their plate to contend with over the next few years.
He added he has concerns about the workability of the proposals as the vast majority of financial advisers he had spoken to said they just aren’t interested.
“There is therefore the risk of a mismatch of supply and demand, particularly given the creation of a mandatory advice requirement for those whose annuities are valued above a certain threshold.”
Mr Hannant said HM Treasury and the FCA need to recognise that the time is therefore not right to push ahead with their plans for creating a new secondary annuities market.
“I believe the correct course of action is to shelve these plans until advisers and their clients have had the time to digest and work through the current market uncertainty.”
Daren O’Brien, director at London-based Aurora Financial Solutions, said: “Although we have no intention of advising on a secondary annuity market, I don’t know why market uncertainty would stop the planning for these products. Market volatility and changes to legislation happen constantly and so now is a great time to fully stress test them in this challenging market.”