This time, though, it should do it better.
The FCA’s survey of companies providing financial advice looked at 233 in total, making up around 21 per cent of advised businesses.
We do not know which major companies took part, but with these things the biggest ones normally do.
What it revealed was that the median ongoing charge was between 0.5 per cent and 0.75 per cent, while the median initial fee was 3 per cent.
The more a client invested, the lower their fees, another perfectly standard finding.
I would like to know the real rates on typical pairings of fees, for example, initial and ongoing.The study was good in that it showed you the state of the market.
It was ineffective in that it did not really show what clients were actually paying, because the study only encompassed advertised charges.
This is where the FCA should look to compile a much more detailed study.
I seem to write a lot about value and client outcomes and how the two issues are correlated, and that is because I know it is an issue advisers spend a long time mulling over themselves.
Perhaps it is due to this age of self-investing and passive funds, where showing additional benefit from advice is so hard to ascertain.
On costs, advisers are split.
There are those who advocate publishing their charges in a transparent manner on their website, and there are those that do not.
Likewise there are those who think you should only charge what you advertise, and those who think customers should be able to haggle and, if reducing your fees secures a client, then you should be able to do that.
In the first case, I think total transparency is everything.
In the second, I am more on the side of the hagglers.
Why should those in the know be allowed to ask for a cheaper ongoing or initial charge? This is just the market at work.
This is where having a survey of real rates customers are paying would also be helpful in that it would provide greater transparency into a market that, frankly, most normal people know little about.
Also helpful would be greater insight into the way charges are implemented.
I would like to know the real rates on typical pairings of fees, for example, initial and ongoing.
And it would also be helpful to know when initial charges are being imposed: is it just on the first lump sum, or is it monthly contributions?
I know cases where simply moving money between funds counts as an initial charge.
I am at a loss as to how the current pension and social care situation will get resolved.This kind of wealth destruction is where customer harm can be done, particularly where a number of businesses do not implement charges in the same way.
Greater insight would only allow better advisers to shine.
Losing out
I am at a loss as to how the current pension and social care situation will get resolved.
Even a saver who maxes out their lifetime pension allowance is unlikely to be able to generate enough income to pay for one year’s fees, which are £33,852 for residential costs and £47,320 if you include nursing costs.
And restrictions on annual allowances are likely to mean someone who suddenly starts earning large sums and sees their contributions increase will not get anywhere close to hitting the LTA anyway.
The LTA is effective in defined benefit schemes, but in defined contribution it is a very poor at restricting tax reliefs.
Has a set of rules ever been such an imposition on prudence and aspiration?
Think before you act
The issue of pension tax relief is the one I flip-flop on the most.
I change my mind as often as Boris Johnson changes chancellors.
I am clear about one thing though: that those advice companies campaigning for flat-rate relief really have not thought of their customers, most of who will be higher rate taxpayers – if not now, then certainly in the future.
Morally they may justify the move.
But their clients will not care for this one jot if it means less in their pension.
James Coney is money editor of The Times and The Sunday Times
