Consumer duty regulations are a revolution for the financial advice profession, not an evolution of the Retail Distribution Review, the head of public affairs at Pimfa has said.
Speaking with editor Simoney Kyriakou at the FTAdviser morning briefing - RDR: State of the advice market 10 years on - Simon Harrington told attendees that legislation such as the RDR, as well as principles-based guidance such as treating customers fairly, should not be used as a lens through which to view the consumer duty.
"It's a revolution, not an evolution", he said. "Consumer duty will be a revolution in terms of transparency and disclosure."
He explained: "RDR was prescriptive regulation, so to an extent if we did not have the the building blocks in place created by RDR, then we cannot have the consumer duty.
"But this new regulation will change the way in which firms...must evidence that they are genuinely working in the client's best interest."
John Cowan, interim chief executive of the Sesame Bankhall Group, agreed. "Consumer duty is revolutionary", he said, speaking from the floor.
In response to a question on whether consumer duty would replace TCF, Harrington added: "Consumer duty has obviated TCF. These are two separate things - I think consumer duty is the logical next step in RDR but from a regulatory perspective they are distinctly different."
Harrington also said the fears and hopes that people had about RDR have both been tempered by the past 10 years post the legislation, which came into effect at midnight on January 1 2012.
He said: "If you look at the most pessimistic views of RDR, where people said there would be thousands of advisers leaving the market, yes there was a drop off but the reality, 10 years later, the number of advisers is basically the same as it has been.
"What does this say? It means there are firms and advisers in the market who saw significant value in what RDR was trying to achieve. And some firms have an overwhelmingly positive view of what it did.
"They say business has never been better as it drove people out of the market who perhaps should not have been there and made people value the service that the advisers gave then, and provided professionalism and standards."
However, he said it was wrong for people to claim the advice market pre-RDR was a "Wild West". "That was nonsense", he added.
Earlier this month, former Financial Adviser editor Hal Austin told FTAdviser the chance to make financial advice a true profession was missed by the RDR.
In the video interview (above), he said: "If you are going to introduce professionalism into the sector I think that you have to go the whole way."