Just one in seven (14%) of advisers believe that FAMR’s key measures are helping to close the advice gap. This is despite 33% agreeing that the FAMR’s key measures are beneficial, compared to only 14% who disagreed. Views on individual measures are mixed, but show a general picture of support for the principles, but there is scepticism over their impact in practice in closing the advice gap.
70% of advisers surveyed agree with the new definition of regulated advice, linked to providing a personal recommendation, but two thirds (69%) don’t think it is helping close the advice gap. Similarly, 44% support the development of clearer guidance on what can be provided through streamlined advice, but fewer than one in six (16%) believe it is having a real-life impact.
Almost half (47%) of advisers support the FCA setting out what help employers and trustees can provide on financial matters without being subject to regulation, in the form of new factsheets and guidance, but just 8% said that these new documents are helping. While around half of advisers have no view on a set of rules of thumb and nudges, a third (33%) support them in practice but only 1 in 10 (10%) see them as currently proving beneficial.
With a Government aim of Pensions Dashboards being available online from 2019, there was strong support from advisers with just under half (49%) agreeing and 20% strongly agreeing with the concept. Despite this 45% don’t think a Pensions Dashboard will help to close the advice gap, with a further quarter (27%) unsure.
There was strong support from advisers for increasing from £150 to £500 the income tax and National Insurance exemption for employer arranged advice on pensions with 69% agreeing with the measure. But even here, only 37% said they think it is closing the advice gap, with 18% unsure.
Steven Cameron, Director of Pensions at Aegon, said: “The Financial Advice Market Review (FAMR) presented a huge opportunity to address the advice gap. In today’s world, people more than ever before have to take responsibility for their finances and seeking advice is the best way to do this. Two years on from the publication of the FAMR report, advisers remain broadly supportive of the measures that emerged, be it the Pensions Dashboard or clearer guidance on what can be provided through streamlined advice. However, when it comes to how effective these have been in practice, the findings are very disappointing. The FCA’s Business Plan points to a review of the impact of FAMR and the RDR but not until 2019. There’s clearly an opportunity for the industry and the FCA to keep working together to identify how to turn a major opportunity into widespread practical benefit.”
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