FSA to publish simplified advice plans later this year

FSA chief executive Hector Sants has confirmed the regulator will publish guidance later this year on simplified advice.

In a speech to the British Bankers' Association (BBA) conference yesterday, Sants once again stressed the importance of RDR in improving the retail investment market.

He added: "We do recognise that, whilst not specifically an issue which the RDR seeks to address, in order to ensure the financial market place is fully effective for investors, it is vitally important that a credible simplified advice service exists alongside the full advice offering.

"Ultimately it is for firms to introduce such services, but we are currently working with them and later in the year we plan to publish more detail on the regulatory framework."

Sants also outlined his intentions for the Financial Conduct Authority (FCA), which will be one of the successors of the FSA.

He said: "The FCA's role should not be one of advocacy or denial of consumer responsibilities but one which emphasises early and proactive intervention, a brave approach to enforcement and redress, and a determination to improve the consumer experience."

His speech comes after the BBA itself urged the FSA to back a simplified advice model.

In a letter to Sants last month, BBA chief executive Angela Knight warned the RDR's aim to create a market "which allows more consumers to have their needs and wants addressed" was in danger of not being met by the reforms.

Instead she suggested the simplified advice model as a solution, arguing it would focus on meeting "straightforward" savings, investment and protection needs more cost-effectively than full advice.