Damian Fantato  

Demands for the next govt

Damian Fantato

Damian Fantato

As you are reading this, you may well know which party has the most seats in the House of Commons following this week’s general election.

Whether you know what colour government the UK will have is another question.

A hung parliament now appears to be within the margin of error and there have been reports of widespread tactical voting across individual constituencies, which might make the national polls slightly misleading.

Financial Adviser will not waste ink advocating for a particular party – apart from anything else, by the time you read this you will probably have cast your vote.

Instead let’s focus on what a new government should do to improve the lot of financial advisers and, by extension, investors across the UK.

For a start, a new government should fix the tapered annual allowance, which has caused so much strife for doctors. But it should also address the funding of the Financial Services Compensation Scheme – ideally through a product levy – and it should also consider rolling out some sort of advice voucher. This would encourage savers to seek out the advice they need when they need it – for example when considering how to draw down their pension savings.

Adviser liabilities also need to be addressed. This is one of the reasons for professional indemnity insurance costs increasing, which in turn pushes up the cost of advice.

Unfortunately all these projects are unlikely to see the light of day. Firstly because governments tend to focus on personal finance initiatives that are more populist and/or make money, but secondly because of Brexit.

Brexit will continue to dominate life in the UK for at least the next year, whether that’s because we are negotiating a trade agreement with the EU or holding another referendum, which means wider public policy will remain on ice. Savers and advisers will be among the losers.