His regular ‘opinion’ column in Financial Adviser is essential reading. Always to the point and on the nail. Not a word wasted as befits someone from Yorkshire (born in the east before making serious money in the west). Not bad for someone who left school at age 15 without an academic qualification to his name.
What I also love about Mr Davy is the backing he has given to sport in Huddersfield, West Yorkshire, a town I know well (I married a beautiful woman from Lepton on the town’s outskirts so I know the area well).
In his time, he has been chairman of Huddersfield Town – the Terriers – a football club I maintain a warm affection for given my brother-in-law is a long-standing (and long-suffering) season ticket holder. Under impressive manager David Wagner, the club has had a good start to the season in the Championship.
He is now enthusiastic chairman of rugby league team Huddersfield Giants who maintained their place in the Super League a couple of months ago by virtue of a thrilling 23-22 victory in the ‘Million Pound’ game against Hull KR.Although Mr Davy admits he came to sport late, his passion for the Giants is huge. He is now hoping the new season, which begins early next year, will be a ‘giant’ one for the club.
Mr Davy is an individual who does not mince his words. Calls a spade a spade.
For example, in a recent opinion article for Financial Adviser, he questioned why the Financial Services Compensation Scheme was wasting money on pointless consumer surveys whose sole purpose it seemed was to show the organisation in as good a light as possible (and advisers in a dimmer one). Why indeed?
He also took a pop at the media (me and my like) for continuing to denigrate financial advisers (I will challenge him on that over a pint of extra smooth John’s Smith bitter the next time I see him).
In a nutshell, what he was saying is that it is high time the adviser industry was given a fairer crack of the whip and recognised for the great work it does. Absolutely.
His views went down a storm. ‘Thank goodness for Ken Davy’s common sense approach,’ wrote one online contributor. ‘Alas, such common sense is as unwelcome in the corridors of power as a fly in one’s soup’, said another. The adviser world needs more Mr Davy's.
In recent days, Mr Davy has been spouting yet more common sense. This time over the way the FSCS goes about raising its funds in order to carry out its business. He believes the current system is unfair, penalises good financial advisers and needs to be overhauled. It is an issue I have written about in the past and I am with him 100 per cent.
His eight-page paper on the subject, which has just been submitted to the regulator’s FSCS review team, is well worth reading. As he says in the email alerting the world to the submission: ‘radical reform of the FSCS is critically important to the future of the advice sector, and needs to be addressed for the benefit of every adviser who is operating in the market today providing an invaluable service to their clients.’
What I like about the submission is that it points out alternatives to the current FSCS funding model. Of course, there is the odd Davy rant, for example, the ‘grotesque injustice’ of the current system, which pushes the cost of the FSCS onto the ‘smallest and financially weakest cohort within the financial services sector’. But it is a document that I trust the Financial Conduct Authority absorbs and acts upon.
Rather than good financial advisers pick up the cost of failed brethren and liabilities resulting from products put together by fraudsters (Keydata, Arch Cru, et al), Mr Davy suggests that product providers fund the bulk of the FSCS. This would be done by the imposition of a levy on new business.
The cost of this levy on individual providers, he argues, would be ‘insignificant’. Advisers would then be asked to provide top up FSCS funding equivalent to 10 per cent of its needs – between £20m and £30m a year. To put this into perspective, the latest FSCS levies imposed on advisers were £91m (life and pensions) and £94m (investment).
‘Radical reform of the FSCS is critically important to the future of the advice sector,’ concludes Mr Davy. He should be supported by every good adviser in the land. Giant-like. This country needs a thriving financial advice community.
Jeff Prestridge is personal finance editor of the Mail on Sunday
