Gill Cardy: We’re not going to survive on good wishes alone

Gill Cardy has plans for the IFA Centre, the trade body she set up earlier this year, and first among them is to find out about her prospective members, she tells Alasdair Pal…

The arguments on message boards and forums are well-worn. With the FSA pushing on with RDR, representation for advisers seems more important than ever. But do advisers need another trade body – or are the current options good enough?

Gill Cardy decided to found the IFA Centre after the Association of IFAs (AIFA) announced in July it would admit ‘restricted’ advisers – the post-2012 name for tied practitioners, albeit ones who must hold the same minimum qualification as an IFA.

A focused voice

Without proper representation, Cardy says, there is a danger truly independent advice would become “a minority activity” after RDR. “We don’t need to speak with one voice… we want to be a more focused voice for IFAs,” she adds.

It is a focus she plans to apply to the IFA Centre’s budgets. Earlier this month, AIFA announced it had posted a deficit approaching £200,000 in the 12 months to July this year. Director general Stephen Gay admitted it had been “a challenging year”.

“It’s not a business where anyone can tolerate fat,” says Cardy. “We don’t need to spend a lot of money on London offices... the world has moved on.”

Hers will be a deliberately lightweight organisation, she says, with fees to match. There are long-term plans to employ a policy analyst, lobbyist and administrator, but no more for the foreseeable future.

Cardy plans to position herself between AIFA and pressure group Adviser Alliance. The difference between a trade association and pressure group, she explains, is size. The IFA Centre should be big enough to tackle the FSA effectively, but nimble enough to represent the differing needs of members.

Central to her plans is using technology to ‘cut’ membership data in a more specific way.

“We’re a better fit for smaller IFA firms,” she says, “but that doesn’t mean they all have the same needs.”

According to Cardy, trade bodies need to be more effective in knowing about their members: what kinds of advice do they offer? How much of their business do they outsource? “The FSA needs to know how different firms respond to different bits of legislation.”

Two-way process

But Cardy thinks the conversation with members should be a two-way process: she wants the IFA Centre to have a strong educational role.

“The myth that independent advisers need to look at every product for every client is still believed by half of advisers,” she claims.

Persuading as-yet undecided advisers about the benefits of offering independent advice is one of her major early objectives. Otherwise, the venture may fail.

“We’ve had plenty of good wishes from advisers, but we can’t survive on good wishes alone,” she says.

And neither, she adds, can small product providers if restricted advice becomes the norm.

“It is possible we might lose some of the smaller Lloyd’s life assurance companies and SIPP providers [post-RDR],” predicts Cardy.

“It’s probably too late” to enact any change to the existing legislation, she says. But the challenge, she adds, will be to tackle the FSA in the post-implementation review stage.

For Cardy and the IFA Centre, it seems, the next few months will be crucial.