None of the advisers would advocate light-touch regulation, as consumer protection - the defence of their own client base - is of paramount importance to them.
However, they have found it difficult to equate the need to stamp out rising levels of fraud occurring during the Covid-19 lockdown with the rising burdens being placed on them in terms of time and cost.
As noted on the letters page of Financial Adviser this week and last week, planners have questioned the need for the Financial Conduct Authority’s Covid-19 resilience survey, given many of the questions were the same as the ones advisers previously submitted as part of their usual reviews.
They questioned the tight timescales, given the already difficult working environment for many of them.
And then, within the past seven working days, the FCA announced its final fees and levies for 2020-21, in which it acknowledged industry concerns surrounding the rising compensation levy, but said it had no plans to revisit a review of the lifeboat body's funding structure.
As Financial Adviser reported, Charles Randell, the FCA's chairman, said in June that the already "unacceptable" levy was likely to increase as a result of the coronavirus crisis.
At the time, he said the system needed to be redesigned so "polluting firms" in the financial sector paid the bill for high risk and unsuitable investments, not "well-run firms" via the compensation scheme.
Advisers have called for a “polluter pays” model for many years; but this is still not going to be the case.
As Chris Budd, chairman of Ovation Finance, tweeted: “It’s a lot easier to regulate (and extract money from) those who obey the regulations.”
One ray of light - there was an announced reduction in FSCS fees for mortgage firms during the pandemic.
The levy payable by firms within the home finance intermediation class has decreased by £2m to £1m, according to an industry newsletter from the Financial Services Compensation Scheme (FSCS).
This move was met with praise from the Association of Mortgage Intermediaries.
Meanwhile, chancellor Rishi Sunak is set to deliver his first official fiscal statement since the March budget.
At the time of writing, Mr Sunak’s roadmap for the UK economy, scheduled for July 8, will detail how the government is aiming to help keep businesses and households afloat in the wake of the coronavirus pandemic.
As reported by FTAdviser last week, the virus’ economic impact has resulted in the UK’s debt-to-GDP ratio breaking the 100 per cent mark for the first time since 1963 and the economy shrank a record 20 per cent in April.
On the agenda might be a levy on personal wealth to boost the UK’s finances and buffer the economy against the impact of the pandemic. Something similar happened in Greece during the height of its crisis (and is still happening); it could happen here.
Rachael Griffin, tax and financial planning expert at Quilter, warned: “A tax levied on the value of someone’s wealth is a worrying prospect given the practical and political difficulties associated with such a broad levy.
“What happens to those with considerable illiquid assets but few liquid assets? What happens to older generations who will need their wealth to pay for future social care costs?”
While the industry is doing all it can to protect savers against scammers, fraudsters and making poor investment decisions by promoting the benefits of financial advice, the possibility of a wealth tax is very disturbing.
What’s the point in tax-incentivised savings, if the government simply claws it back to help dig the economy out of the hole? This is hardly a vote-winner, but with an election so many years down the line, who will remember the government's wealth grab of 2020?
Simoney Kyriakou is editor of Financial Adviser
