View more on these topics

AIFA chairman says industry needs to get back onto the front foot

In his final speech as chairman of the Association of Independent Financial Advisers at the Association&#39s annual dinner yesterday, Lord Hunt said that the predominant themes during his three years as chairman were regulation and reviews.

In a personal plea to guest speaker FSA chairman Sir Howard Davies, Lord Hunt says: “I urge the FSA to deploy rigorous self-denial on new initiatives. Sir Howard, you have been lumbered with a complex and lengthy process whenever you want to change anything. As the number of new initiatives mounts, so the process backlog grows. And delay in the North Colonnade means delay for businesses.”

He added: “Businesses, especially small businesses, cannot keep up with a flood of papers, any one of which may contain a torpedo for their plans. In addition, the FSA cannot function if it becomes tied up in its own processes.”

Referring to possible changes in the market following the FSA&#39s consultation on the reform of polarisation, Lord Hunt said: “Next year, IFA firms are likely to need to consider their positioning in a market where there are more options. They will have to assess whether the distributor company fits with their corporate strategy; the competitive impact of new disclosure arrangements for tied agents as well as IFAs; and the potential effect of a Sandler suite of products.

“At least the menu approach [which AIFA has developed with IFA Promotion] allows them to think first of their business strategy, and their choices are not cut off by what the regulator demands. They need to have some confidence that the goalposts are not suddenly going to shift again; or at least not by too much and not repeatedly.”

He then considered how the situation could be remedied. He said: “First, there could be a self-denying ordinance, as I mentioned. Second, perhaps the FSA should look to work more in partnership with the industry and support its initiatives, rather than invent everything itself. Third, the sector needs room to create its own ideas. The problem with the stream of third party initiatives is that it makes the industry passive and reactive. A greater sense of partnership might allow more creativity and a greater sense of shared responsibility.

“For our part, AIFA certainly would respond positively and indeed it is my hope that we will be able to get back onto the front foot in 2003, after 12 months where our agenda has been dominated by others, not least CP121 and Ron Sandler.

Looking back to the start of AIFA and the objectives which were set at the time, Lord Hunt asked: “Have we achieved what we set out to achieve? We wanted a single voice for the IFA sector, from the largest national to the smallest one-man band. And AIFA does indeed embrace every variety of IFA, with around three quarters of the market in membership.

“We wanted to be taken seriously as a trade body and as the representative voice of the IFA by the FSA, government and anyone else with influence over the lives of IFAs. I am happy to stand by our record. We have changed agendas, not just responded to them, not least over CP121 and the introduction of the menu option. And there have been many other more subtle &#39hits&#39.

“Of course, there have also been misses. There are still initiatives which almost casually try to bypass the role of advice – despite all the evidence that the advice gap drives the savings gap. But, overall, there has been progress and I am delighted to have been associated with it.”

Recommended

HSBC buys into US sub-prime

In a deal that took the US mortgage market by surprise, banking giant HSBC Holdings last week paid $13bn for Household International, Illinois, the largest player in the sub-prime residential niche.HSBC will gain access to more than 1,400 retail outlets, $49bn in housing receivables, and all the headaches that go along with B&C (sub-prime) lending.Even […]

IFA targets the rich

Solihull-based IFA Millennium Financial Planning expects to double its number of high net worth mortgage clients and double its annual mortgage business to £360m.Millennium plans to recruit 2,000 new members to its financial management service each month. It is increasing its subscription team and has made several key appointments. These include Andrew Wenzel, previously managing […]

Housing market continues to slow, says hometrack

The hometrack national November survey of the housing market reveals house price rises averaging only 0.2%. This is the sixth successive fall in house price inflation since May&#39s peak of 2.6%. The slowdown has been mostly the result of falls in higher value properties, mainly in London and the South East. London house prices falls […]

Property investment fund celebrates third year

The Surrenda Link Investment Fund (SLIF) is celebrating its third anniversary by revealing overall growth of 24% since launch. In comparison, the FTSE 100 has fallen 34% in this period. SLIF was the first of its kind to combine Traded Endowment Policies (TEPs) with commercial property. So far this year the fund has seen large […]

Sub-Saharan Africa Near-Term Outlook

By Paul Caruana-Galizia, Neptune Economist

Sub-Saharan Africa’s economic renaissance continues. After growing at an average rate of five per cent over the past decade, the IMF projects an acceleration to 5.5 per cent growth among Sub-Saharan economies in the next two years, as developed economies emerge from the crisis. We expect this growth to be sustainable for three broad reasons.

Newsletter

News and expert analysis straight to your inbox

Sign up