Posted on by Tolu Akisanya

Press Release

PIMFA Responds to the Launch of a Further Inquiry into Contingent Charging

7th January 2019

 

PIMFA, the trade association for the personal investment management and financial advice sector, has today responded to the launch of the Work and Pensions Select Committee inquiry into contingent charging.

PIMFA Senior Policy Adviser, Simon Harrington said:

‘We maintain the position we laid out in May 2018, namely that the removal of contingent charging will not necessarily improve the quality of advice consumers will receive or, indeed, improve their overall outcomes, and we reiterate the unintended consequences of imposing such a ban.’

‘Removing contingent charging without a viable way for individuals to access advice will ultimately turn people away from an absolutely indispensable part of the retirement planning process. Further, it will increase the number of insistent clients who do choose to access advice and in the worst circumstances push them towards poor advice options that will ultimately deliver to their wishes – a transfer regardless of their circumstances.’

‘The role of financial planning plays a fundamental part in our modern society. It enables individuals to access products, support and peace of mind at a time in their lives where uncertainty prevails. The overwhelming majority of financial planners know this and are acutely aware of their responsibility to their clients and their local communities. We are therefore concerned that the actions of a minority of errant advisers – or to use the Work and Pensions Select Committee terminology, ‘vultures’ – appear to colour the Committee’s assessment of the advice industry in general. We would urge the Committee to consider the civic good that advice plays going forward in its assessment of the industry.’

‘There is a wealth of independent evidence which points out the utility of financial advice and, in particular, its impact on individuals with lower levels of wealth and financial literacy. Financial advice plays an enormous role in delivering the best possible outcomes for individuals and we should strive to ensure that as many people as possible are able to access it rather than cut off avenues to it.’

Read the original PIMFA Consultation Response here.

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Notes for Editors

About PIMFA – the Personal Investment Management & Financial Advice Association

  • PIMFA is the trade association for firms that provide investment management and financial advice to everyone from individuals and families to charities, pension funds, trusts and companies.
  • PIMFA represents both full and associate member firms. Full members provide a range of financial solutions including financial advice, portfolio management, as well as investment and execution services. They assist everyone from individuals and families, to charities and pension funds, all the way to trusts and companies. Associate members provide professional services to the PIMFA community.
  • PIMFA leads the debate on policy and regulatory recommendations to ensure that the UK remains a global centre of excellence in the wealth management, investment advice and financial planning arena.  Our mission is to create an optimal operating environment so that its member firms can focus on delivering the best service to clients, providing responsible stewardship for their long-term savings and investments.
  • PIMFA was created in 2017 as the outcome of a merger between the Association of Professional Financial Advisers (APFA) and the Wealth Management Association (WMA) with a history as a trade association going back 29 years – read more.

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