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Goddard warns advisers against complacency

by Michelle Abrego on Nov 20, 2012 at 11:13

Goddard warns advisers against complacency

Advisers have made strong progress improving their professionalism since the retail distribution review (RDR) was first proposed but still have work to do implementing adviser charging and understanding VAT, according to outgoing Personal Finance Society (PFS) chief executive Fay Goddard.

Goddard, who will retire from her position at the head of the PFS in 2013, has led the organisation since 2008, a five-year period she described as ‘challenging’ for advisers.

She said she could not overemphasise the difficulties advisers faced with the RDR, the financial crisis, low interest rates and constant political reforms converging to put immense pressure on their businesses over the past few years.

Boosting professionalism

Under Goddard’s stewardship, the PFS has played a significant role in helping advisers to become qualified for the RDR and in boosting professionalism with its chartered financial planning initiative, but she is aware that qualifications are only one part of the challenge.

She said she was still concerned about whether IFAs understood and were able to cope with adviser charging, legacy issues, VAT and the inconsistency of providers’ offerings. ‘The biggest challenge for advisory firms is wading through all of this,’ she said.

‘[Advisers are] getting a complete patchwork [of information] from providers, platforms and fund managers, and it’s going to be the [toughest] challenge for the first few months,’ said Goddard.

The PFS’s annual survey of members conducted in September showed that 90% of IFAs felt personally prepared for the challenges the RDR would bring but only 80% thought their firm was ready to implement the changes.

‘That’s one in five firms that has not implemented adviser charging,’ she said. ‘They’re leaving it very, very late.’

Awaiting a successor

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18 comments so far. Why not have your say?

Jonathan Kirby

Nov 20, 2012 at 12:10

So Fay is retiring at age 62, the same age as I am. I just wish I had that luxury as I must wait another three years.

I have now had confirmation of my level 4 from the NMBA Alternative Assessment. It allows me to continue past January but has added nothing of any real significance to my knowledge and I will not change anything about the way I advise.

Had it not been for Ken Davey's vision and understanding of what is needed by older and experienced IFA's it would have been a different story and many thousands of clients would have lost their trusted advisor as I believe around 250 have chosen this route.

The CII Alternative Assessment was taken up by virtually nobody and seemed to be designed simply as a way of saying they had complied with the FSA wishes but to shoehorn people down the easy to implement exam route favoured by the CII and PFS.

This is what I find disgraceful and disturbing that these people could have, like Ken, designed something that was workable and of real use to their members and prospective members.

Perhaps they will take these thoughts on board for the future as I have never come across a trade body held in such little esteem from the majority.

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Simon Mansell

Nov 20, 2012 at 12:38

Fay is so certain about her definition of “professional” that many advisers who considered themselves professional paid the price with their livelihoods. Why not let the consumer decide as they have been doing? For those without level 4 they will not have the luxury of a planned retirement unlike Fay. It is one thing to impose new rules for new entrants to the IFA profession; it is quite another thing to disqualify someone in latter middle age who is already qualified, and who has an exemplary complaints record. I wouldn't want to go to my retirement in the knowledge that I helped accelerate the retirement of many others with my anti grandfathering stance.

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Louis Perdikou

Nov 20, 2012 at 13:23

Earlier this year at my second attempt I passed the CIOBS Diploma in Investment Planning, a qualification deemed QCF Level 4 by the FSA and the Examination Board. Today the CII informed me that they consider it worth only 10 credits. That's half the credit of most of most of the individual JO examinations. For me, the CIOBS examination unlike the RO exams looked at applying my knowledge to my advice process and seemed far more relevant than remembering formulae. Having sat the original FPC back in 1992/93 and been a member of PFS/CII sine then I have become very disillusioned by this organisation which seems more like an examination factory. For me personally CIOBS stands for far more as a Financial Services representative body . Thank you CII for making the decision as to whether I will continue to pay the £175 annual membership.

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Phil Johnson via mobile

Nov 20, 2012 at 13:38

Well done Jonathan on passing the Alternative Assessment, your right Ken Davey in a visionary. I'm in the middle of mine now, fingers crossed I'll be able to continue to advise my clients from 1st January!!

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Jonathan Kirby

Nov 20, 2012 at 13:49

@ Phil Johnson

I am sure you will have no trouble but if you would like any hints on what is required etc., feel free to get in touch at joe@wdgill.co.uk

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Chris Holmes

Nov 20, 2012 at 14:18

@Jonathan Kirby

PFS is not a trade body; it is a not-for-profit professional body funded by its members. From what I can see the trade bodies are part-funded by providers and appear to spend more time lobbying for providers and their own existence than on behalf of their members.

And I cannot see any evidence for your final assertion, nor for your earlier statistics. The manner that the PFS and Fay have worked alongside the FSA on behalf of its members has been exemplary.

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Steven Farrall

Nov 20, 2012 at 14:18

Oh ho, here we go again.

One of the good tests to do on statements is to reverse them. So for example 'professional finanncial advisers', becomes 'un-professional (or amateur) Financial Advisers. 'Professional' is the most over used word. Along with 'free' as in 'free advice'. Financial advisers can be good and bad as can all other 'professions', being 'qulaified' is no guarantee of either.

In this instance it is used by the CII in the same sense as 'qualified', as in having sat and passed their exams. But as we all know 'qualified' also means limited, as in 'qualified success'.

The RDR in an atrocious and unjustifiably authoriratian assault on freedom based on made up statistics in turn based on fairy story concepts.

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Jonathan Kirby

Nov 20, 2012 at 14:33

@ Chris Holmes

The NMBA will confirm exactly how many took up their AA but I think you will find my figure accurate.

David Ross replied to me on an earlier blog:


Sorry I am not deliberately avoiding answering your question about the alternative assessment. Off the top of my head I really don't know how many will have actually taken it but I suspect it's only a handful. Not unrealistically being tested over the course of a single day on all of the FSA's learning points - effectively a first year degree - is understandably not for everyone.

David Ross


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Green Eyed Monster

Nov 20, 2012 at 14:37

@Chris Holmes

"From what I can see the trade bodies are part-funded by providers and appear to spend more time lobbying for providers and their own existence than on behalf of their members".

Not all trade bodies Chris. Have you looked at IFACentre?

I'm sure Gill be pleased to 'put you right' anytime you are interested.

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Chris Holmes

Nov 20, 2012 at 14:53

@Green Eyed Monster

Agreed; one of my generalisms and I recognise that there is an exception to the rule (more than one if you include STEP, although I am sure they would not classify themselves as a trade body).

IFACentre is, though, part-funded by providers and I am sure Gill will confirm that this does not create any compromise on her part.

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Philip Melville

Nov 20, 2012 at 17:39

So Chris, there is no provider money used within the PFS ! What is sponsorship of events by providers if it is not provider money including the flagship annual conference ?

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Chris Holmes

Nov 20, 2012 at 17:55

No need for the exclamation mark, Philip; I was simply correcting an inaccuracy. I don't recall suggesting that the PFS is not in receipt of provider sponsorship. My initial comment was to point out that the PFS does not hold itself out to be a trade body, although like Gill's trade body, it can pride itself on representing its members' interests.

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Phil Johnson

Nov 20, 2012 at 18:15

@ jonathan

Thanks for the offer of help, hope I don't need it, but will certainly be in touch if struggling!!

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Philip Melville

Nov 20, 2012 at 18:28


I have no wish to embark on a slanging match but I see the PFS as simply serving the commercial interests of the CII.

Since its formation from the LIA and SOFA it has steadfastly promoted qualifications above all else although it has not even attempted to provide learning material with any relevance to the service world which our industry is about to enter.

The egotistical appeal to the whimsical notion of a so called Profession has been its main weapon in promoting the sale of its mainly recycled course content - very successful too I must admit but we shall soon see how little use it will all have been as advisers struggle to justify their place in people's financial arrangements.

A very useful tool for providers taking everyone,s eye off the all important remuneration issue until the last minute - hence their willingness to provide money as needed along the way.

Sorry Chris but you have been mugged in a grand style by some of the best salespeople you will ever come across.

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Chris Holmes

Nov 21, 2012 at 09:24

Always suspicious of the starting gambit 'I have no wish to embark on a slanging match..'. and was not disappointed.

Clearly our respective perceptions are different, Philip, and this is presumably borne out of personal experiences. I certainly don't feel like I have been mugged but, then again, I recognise that the PFS was early out of the blocks on the road to improving standards.

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Philip Melville

Nov 21, 2012 at 09:50

I think you will find that the LIA were at the forefront with the FPC.

And you should remember that it is the PFS which is deciding what

Constitutes " professional " or standards as you call it. Hopefully as we move into next year it will become the publics opinion that matters .

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Chris Holmes

Nov 21, 2012 at 10:10

Jeez, Philip, I was trying to be conciliatory.

There is quite a bit that I disagree with on the earlier posts, but we are all too busy to bring personal differences in to a public forum. PFS is not fixed on labelling indiscriminately - far from it - but wants to be aspirational and I cannot see anything wrong in that.

I am afraid it is not the public that decides as they will not establish a Code of Ethics, hand out practising certificates, form professional discipline standards and all other features associated with a professional body. A step on from LIA but I do agree that our industry is some way off from being 'professional' but the work by the PFS and other bodies moves us down the line.

It is not a closed shop but PFS has established a framework that supports entry-level advisers and Chartered practitioners alike. Have another look under the bonnet or talk to your local Chairman

Happy to take it offline.

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Philip Melville

Nov 22, 2012 at 08:40

Morning Chris,

Sorry but it is not a step on from the LIA as the LiA had a Code of Ethics back in the 80,s which all members signed up to and a Disciplinary system to administer breeches.

The PFS abandoned all of the stuuf you mention when it took over the LIA and has only later reintroduced it all - including Regional Meetings - as though it was somehow original.

I have been involved under the bonnet and quite clearly see that the PFS is the only " trade body " which is wholly focused on selling stuff to its members and which has now used its franchise to effectively handcuff its members via the practicing certificates.

You may be an employee or other devotee but you should take the time to look into what you are defending.

Have a good day.

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