FSA berates pension switching worst performers over inaction

Who are you kidding

I don't feel that it's credible that not one of the firms have improved in the interim! I know for a fact how hard one of the firms is working on this and I doubt if anyone has a more robust and stringent system in place. Anyone not happy with it would be pretty hard to please (or perhaps they just don't want to be pleased).

Posted by: Nick

How do they know

I am curious to know how the FSA know that poor advice has been given on pension switching. Do they keep a record of what the existing pensions were and then compare that performance with the performance of the new pension schemes - and do they then get in a time machine and see what the position will be at the point when the relevant people retire. Do they allow for the fact that that in many cases the funds with which an individual starts is likely to be the same fund that is there at the end, unless there is some professional advice involved. And professionals do not give advice for free. So even if the professional charges fees, that will impact adversely on the fund performance, but the advice could impact beneficially to a greater extent - that is the intent of professional advice, even though it may not always be the observed effect. The administration of some providers is so poor that it would not be worth taking over the administration of those policies - the fees required would far outweigh any potential benefit. But that is not a good excuse for the FSA to use - surely they should be ensuring the the administrative quality of providers is of such a high quality that the investor is not disadvantaged by such considerations. Has anyone heard of any FSA initiative in this respect? There are so many variables involved in moving pensions that it is difficult to see what effect this type of action by the FSA is having (other than keeping themselves occupied). It is quite possible for even poor decisions to turn out beneficial in the end. The whole FSA process sounds dysfunctional, for it is not based on any rational structure. In fact the whole overweight administrative process is more likely to have an adverse effect on the advice provided to clients since in many instances Advisers are going to turn away from providing that advice because they see more problems than they can expect remunerations. There is an old Chinese proverbs that says "Beware what you wish for". The FSA should have that one pinned on their walls, because the Law of Unintended Consequences keeps striking. However, as the FSA is not accountable for their actions why should they worry. The IFA and the Client are equally expendable, just as long as they have a nice office in Canary Wharf to go to.

Posted by: Glen McKeown

As ever was..

The FSA did this with Equitable Life they threatened action against any one transferring clients away from Equitable. Are they doing the same again on behalf of ABI members? trying to stem the loss of highly profitable funds for the providers? There are many policyholders who are stuck in loss making funds and have been for many years now and the situation is getting worse for them. Who is acting in the best interests of the consumer?

Posted by: Mr Fisher

Pension switching

This smacks of the same situation as the endowment review. Assessing that advice is wrong before the end result. All the FSA are doing are driving away the general public from protecting themselves whether it be ordinary protection, savings or pensions. Between them and the government they are making a right pigs ear of things.

Posted by: terry arch

Blinkered look

Here we go again the FSA seem to believe that everything the IFA does is wrong. This constant berating of our advice is why Joe public think pensions are a waste of time. Firstly there was freedom of movement of pensions back in July 1988 along with contracting out - take your pension with you from job to job said Margaret Thatcher. Then a few years later that was wrong and advisers were slated for their advice. Then we had the successful stakeholder pension where it's all about charges, not fund choice or paying for advice, cheapness means quality apparently - not in my book it doesn't! And now what 2012/13 NEST the new compulsory pension where again advice is IGNORED and the IFA has been cut out of the process. Well done FSA keep knocking the advice, fining the firms and eventually you'll have no advisers/firms left giving advice and therefore no need for the FSA. Take a look at your track record FSA it speaks for itself!

Posted by: Duncan

blogs

I regularly comment on blogs on articles I read concerning financial services and the FSA. People may not always agree with me, but the main thing is that i make my feelings known.I cannot understand why all IFA,s do not stand together and react.The only reasons I can assume that we let the FSA ride all over us and accept their advice(instruction) is always correct is as follows:- 1. You have two camps. One which suggests that exams are the be all and end all. The other who feel that experience is also an added quality. 2. The IFA is frightened that they will be picked up by the FSA radar for criticising them and receive the dreaded intervention. 3. They are all struggleing to pay the increased costs being applied by the FSA, FSCS and FOS and all the increased costs of running the business. Remember all the forms etc that were supplied by the providers, the cost of which is now born by the IFA by printing documents from the PC. Remember this is all before being able to eat. 4. Reduction in income by continious reduction in margins due to changes in commissions/fees. 5. Now having to take extra time out for studying to even remain in their occupation after 2012. A lot of people compare us wanting to be like Doctors. Can you imagine what the state of the NHS would be like if all doctors were told they cannot practice at all no matter what qualifications they have taken in the past after 2012 unless they take a whole new raft of exams

Posted by: terry