Adviser > Your business > RDR > Retail Distribution Review > Professionalism
Professionalism
The FSA’s attempts to bring more visible qualifications and standards to financial advice appear to have met with consistent market agreement.
The original DP seemed to be heading for Chartered or Certified Financial Planner but the Interim Paper appears to have settled on a QCA Level 4 qualification, which can be achieved by attaining the Diploma in Financial Planning. Although the position isn’t final, ‘grandfathering’ arrangements do not appear to be likely.
‘On the job’ training was floated by some as an avenue for further discussion. However, the report is fairly neutral on the subject.
Scottish Life's view
Initiatives to increase professionalism in any sector of financial services are to be welcomed.
We feel that having a minimum qualification level is reasonable so long as the bar is not set at an excessive height, and advisers are allowed an appropriate length of time to achieve that qualification. Any other approach would be likely to reduce both current adviser numbers and the attractiveness of the financial advice sector for people considering a future career.
The FSA seem to have struck a reasonable balance with a Diploma level – which is roughly the equivalent of first year of a university course – rather than the degree-level qualification that was originally mooted.
While the Interim Paper seems to sit on the fence in terms of whether or not advisers need to become members of a professional body, the tone suggests that, subject to competition law issues, this is favoured. The danger, the FSA believes, of not having a compulsory professional body is that some advisers may attempt to sidestep some of the professional requirements.
One final issue that falls into this section is the idea of a “long-stop” time limit on complaints. In general, the feedback appears to have been supportive of this, except from consumer groups. The Interim Paper suggests the benefits may not exceed the estimated cost of the cases the Financial Ombudsman Services estimate would be excluded each year. However, the FSA does invite information that can help their thinking here.
Next page >>
Next steps
For professional advisers only
