Brexit took a backseat this week as local elections dominated politics, along with the sacking of former defence secretary Gavin Williamson.
Closer to 'home', the industry shouldered a higher-than-expected levy and the taxman revealed it had received £4.4bn more than expected in pensioners' income tax.
It's time for the week in news.
1 Rising levy but good news for advisers
Earlier this week the Financial Services Compensation Scheme announced a levy of £532m for this financial year, an increase on its original forecast, which it attributed to an "uplift" in the number of claims expected against self-invested personal pension operators.
The levy was £16m higher than expected, but those in the life distribution, pensions and investment intermediaries sector saw their levy decrease from the £175 originally predicted in January's plan and budget to £153m, a saving of £22m.
The lifeboat fund confirmed it expected the main driver of compensation costs falling on the FSCS this year to be pension claims, with the majority "continuing to arise from bad advice to transfer retirement savings out of occupational schemes and into Sipps".
2 Going for gold
It's been a turbulent month for the advice market following the rise to the Financial Ombudsman Services' compensation limit, with advisers telling of their struggle to find professional indemnity insurance amid rising premiums and excesses.
This week saw a further development from a big player in the PI market, Liberty, which confirmed it will take into account the Personal Finance Society’s Pension Transfer Gold Standard when underwriting an advice firm.
Liberty stated it will ask firms that want cover for defined benefit transfers going forward whether they have achieved or applied for the gold standard and stressed it would be one of the conditions affecting the PI policy.
Keith Richards, chief executive at the PFS, hinted other insurers had indicated they would also require advisers to confirm a commitment to the standard but did not disclose any names.
3 Barriers to platform switching
Complexity, cost and suitability concerns are dissuading advisers from switching clients to a different platform, it emerged this week.
Research from consultancy the Lang Cat found over the long-term, the differential in charges between different platforms was enough to justify transferring, but the cost and complexity of undertaking such an action meant 56 per cent of the advisers were unwilling to recommend a transfer.
The Lang Cat's research, which involved 95 advice companies, found it would cost £1,155 to transfer clients to a new platform and take 20 hours.
The Lang Cat's Mark Polson said: "Many advisers told us that they will move new clients to different platforms, but keep the existing book of clients on the old platform due to the complexity, but we think that if the advice firms' processes are good enough, and the platforms are on their game, then it could get down to three hours to do a transfer.
"None of this is simple, but advisers don’t have to go back to first principles either."
4 FCA looks to advisers in market review
The regulator appealed to advisers for feedback this week with the launch of its review of the financial advice market and the impact of the Retail Distribution Review and the Financial Advice Market Review.
The FCA called for input on the role of regulation in the market, barriers to effective competition and the affordability of advice and guidance.
But the City-watchdog admitted some of its rules may be harming the market and its consumers, asking advisers if regulation was driving too many people to seek advice. The question echoed a similar tone to that seen in the regulator's Mortgages Market Study last month in which it claimed some consumers were being "unnecessarily" channeled into advice.
The FCA has asked for feedback by June 3, although leniency over this deadline has been hinted following industry suggestions the current timeframe did not offer the opportunity to do the topic justice.
5 Taxman receives pensioner bonus
The government was in the spotlight this week after being accused of hiding figures in its small print when it emerged pensioners paid £4.4bn more in income tax on their pensions in 2016-17 than had previously been expected.
In its pension tax relief data published on Tuesday (April 30), HM Revenue & Customs stated in a footnote that the calculation of tax being paid by pensioners has changed and instead of using a sample survey, the figures are now based on real time information supplied by pension schemes.
This means that the taxman has corrected its own figures on pensioners’ income tax from £13.5bn to £17.9bn.
The figures are relevant as they affect the government's estimation of the tax relief it has given, with Sir Steve Webb, former pensions minister and director of policy at Royal London, calling it "outrageous" the government had "sneaked out these massive revisions to the figures" without any comment.
rachel.addison@ft.com
