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Topics: BNP Paribas| qualifications| CWC research| multi-asset
The RDR fails to meet its original objectives on the key issues of qualifications and increasing access to advice, according to new research.
The study, by CWC Research in association with BNP Paribas, says qualification proposals do not match the original intentions of the RDR and the drift up-market will deprive the mass market of access to advice.
Clive Waller, of CWC Research, says the new qualification requirements are disruptive, distracting and disappointing.
"It is unreasonable to ask 60-year-olds to take a whole new set of exams," says Waller.
He suggests using a qualification system similar to that used by GPs, whereby advisers can deal with those issues on which they are qualified. They would then refer clients to other advisers where they lack the necessary knowledge.
Waller's view was backed by AIFA director general Chris Cummings, who says the current framework is anything from six to 18 months behind.
"How can we expect firms to jump that high if they don't know where the ground is?" he says, referring to the qualification guidelines. "I would be comforted by a GP-style of qualification where advisers can refer."
Waller also warns the FSA's proposals do not address clients' savings and pension plans and could be detrimental to the vast majority of the population.
"It is bad news if you are not relatively wealthy now, are young and starting out, are not in a good pension scheme - in fact most of the population."
He rounds off his stinging attack on the FSA's proposals by predicting that ultimately 20-40% of advisers will be lost as a result of the RDR.
CWC conducted interviews with over 100 individuals at 70 IFA firms and ten board level employees or divisional managers of nationals and networks.
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Im not saying that qualifications shouldnt be attained. Im saying that considering the FSA and the relevant training bodies have only just decided what they want gives very little time for anyone, with a busy business, maybe a seriously ill spouse or an illness themselves to become qualified to a required standard if they want to be. Its just a rush job...did you, for instance, know 3 years ago that you would be required to achieve level 4, or any other standard? No, you could guess but it was never confirmed. And before we go on about other "professions" such as accountants - first of all, any qualifications for these professions are not applied retrospectively, and I can gurantee you that you dont have to be an accountant to offer accountancy services. You can run a highly successful, high quality, customer orientated accountancy practice and not be a qualified accountant. This is because you can spend time understanding the clients needs whilst building a relationship with them. You can offer your uninterupted time to understand the problem while you give the work to someone else (who is qualified) to do the job! It doesnt mean that you cannot offer a first class service, it is generally a better service than the accountant down the street, provided you have structured your business correctly and with good complaince procedures. And who has a more compliant, structured procedure than HMRC. We just need to get out of this mindset that qualifications are the be all and end all. They are just another part of the job. If I were unqualified but had the right people dealing with the right client within a robust compliance arena then what would be the problem? As sole traders or small companies our industry is running around like rabbits caught in the headlights because the pressure is on and this FSA will not work with our industry as they are all powerful and WILL do what they want without any real consultation whatsover.
Posted by: Richard Blackshaw
.
Age does NOT automatically make you a competent adviser.......and neither do qualifications.
Posted by: Martin Lewis
Martin Lewis
Well said Martin!
Posted by: richard blackshaw
Absolutely SPOT ON!!!
Kevin Purnell is like the FSA - not in the real world!! He obviously has an upmarket view from his ivoty tower - again just like the FSA! I have seen plenty of highly qualified uni graduates in my time and they certainly do not do a better job than those with experience.
Posted by: Iain
Not Spot on
I am a 60 year old and have been in the business for a long time and do not want to sit more exams. I am happy to pass on my clients to more qualified advisers and from my experience clients do appreciate the advice and know I am still the first port of call when they need financial advice.
Posted by: Alan Gyles
Positive Age Discrimination
I'm sorry Kevin but I have to agree overall with Richard. I don't know your age Kevin and I'm much in favour of good technical qualifications, but you must be a lot younger than me. I'm beyond 60 years with a highly competent colleague beyond age 70. Exams are actually quite a poor substitute for experience and normally present little problem to gain a pass. But when you get past 60 your powers of recall in the examination room are often slower than they once were. The only way to resolve this is to give more time in the exam room for the older adviser. After all, what does it really matter if the paper takes an extra 20 minutes or so for the older adviser? Unfortunately the powers that be don't see it this way and want to stick rigidly to the same time limit for all. I would call this positive age discrimination. Would't you? If not, what else is it then? Bearing in mind the large number of older advisers this matter must be addressed, because many of us are not going to quit our clients- we enjoy the work too much and have no intention of retiring.
Posted by: John Hopkinson
Fetishism
It appears that qualifications have now become a fetish for a significant part of our community. Can we please get back to the core process of a sustainable business model to provide quality advice at a competitive price to CLIENTS - remember that word, it is important. Qualifications are part of the equation, not an all consuming end product. And age doesn't guarantee quality - though it does suggest that a decent job has been done to survive (but no guarantees). The general quality of advice has been improving in the 37 years I have been in the industry, and it will get better - but not if we kick out all the experience of dealing with people and problems. Newton achieved his greatness "by standing on the shoulder of giants". The current trend in our industry appears to be to shoot the giants in case they're an embarrassment.
Posted by: Glen McKeown
Call for GP-style qualifications
As an aside, what qualifications do the key members of the FSA hold ? or for that matter, the FSSC ? or the various and numerous other quangocrats all pontificating and expounding their wisdom. This country is now drowning in bureaucracy and red-tape which is being generated by people in government non-jobs and official quangos - it's not just financial services, its everywhere. We need a revolution !
Posted by: bill wells
RELEVANT Qualifications
In short I agree with what Richard Blackshaw has said. In detail, I think for me the problem is the relevance of some of the qualifications. CII seems to ask too much and IFS too little at the moment. If it were accepted we could market ourselves as General Independant Financial Advisers (GIFA) and then choose specialisms relevant to the clients we serve, then PI rates would reflect the qualifications we had to do different work. This would be the TRUE industry led solution the RDR was originally suppossed to be and not a quango and interested partis led solution. If the risk is truly with less qualified advisers, then the PI insurers would be asking more about this and my premiums for PI would be massivley higher than they are. The RDR and the CII exam system is a hammer to crack a nut. I am pleased that the CII have clarified that you only need your 80 points at diploma through exam and the rest can be through CPD as otehrwise I'd worked out if you needed an exam for each area where there is SOME relevance, I'd have to sit all the Diploma papers, despite the fact there is a lot in each which is NOT relevant to what I do with clients (as a GP IFA I refer what I don't do day in day out to otehr IFAs who have a different specialism to me) If Kevin wants to be considerd recognised as a Professional, then market yourself as a PIFA and I'll market myself as a GIFA based on our exam differences and clients' will choose based on the service THEY want, not the service they are told they must have. GIFAs can act as the relationship manager without being authorised or qualified, simply by changing their title and then introducing to a qualified individual, OR an acceptabel compromise of job titles which reflecty ones qualifications could be agree such as PIFA and GIFA....
Posted by: Phil Castle
Rethink
Let's get away from this attitude of "you've had long enough to get the exams" or "you've known about this for long enough". A wrong course of events is still wrong even if the theorists have been pontificating for years. The FSA must understand that the negative consequences of their plans will far outweigh the good. These are also negative consequences for consumers so, bearing in mind their statutory remit of protecting and educating the consumer, it baffles me why they continue pursuing this course. There are other, better, cheaper, less intrusive means available. Wake up FSA before it is too late and the unintended consequences result in wider savings and protection gaps.
Posted by: Alan Lakey
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Spot on!
Absolutely spot on! This is just common sense at its best. It also shows that a financial services business can be run effectively, with high professional standards (and I dont mean qualifications etc), by treating clients fairly and giving them access to outsourced advisers that specialise in specific areas. That's how a business is run effeictively, no matter what that business does. It assists greatly with compliance. It shows the client that there is no pressure to sell as the business is acting with their best interests at heart. And in my experience, when I have outsourced a particular type of business to one of my colleagues who is more highly qualified in a specific area, the client has bent over backwards to thank me for giving them the opportunity to deal in this way. They also realise that no one can be a jack of all trades if he/she wants to provide a quality service to a client. BUT- you dont honestly expect this steamroler of a FSA to even listen do you? God help this country. Its run by quangos!
Posted by: Richard Blackshaw