I spent some leisure time yesterday afternoon with Steve Bee in and around the Bermondsey St Debtor’s Prison in which Jargon Free has its offices. I am 10 years younger than Steve and for many years have seen him as a mentor ( he co-wrote a book called Savings Sense with Ben Jupp in which he called for state paid advice for all) . I remain amazed about the simplicity and depth of Steve’s insights.
Lately I’ve had cause to question some of Steve’s thinking which doesn’t quite agree with mine but I’ve never had cause to question his integrity and as time goes by, the age difference seems to fade and Steve becomes a peer rather than mentor.
As well as the cartoon’s, Steve writes in an elliptical style which influences rather than opines. He sees me as a blunderbuss (which is right) a sort of Pension Ian Paisley, he is more the quietly effective Jerry Adams (IMO)!
Steve has developed an alarming habit of injuring himself, he broke ribs goalkeeping in a friendly against his grandkids and yesterday he bruised his coctics when falling off his bar stool. It worries me that Steve’s balanced approach may be a little out of kilter!
When I got home, there were a load of emails to deal with including a message from someone commenting on some remarks of Steve Webb reported in Citywire, Steve (Bee) had commented to me about the roasting he’d got on Citywire’s comment pages recently – certainly most of the reaction to our Pension Minister’s call for “cheap and cheerful” advice were little more than “abuse”.
One however stuck out as being thoughtful and well-articulated, Here’s someone called Paul Howard on the delivery of simplified advice to the mass market,
“The FCA set out its simplified advice guidance in July to support firms that wanted to provide simplified advice or sales without giving a recommendation. ”
How can simplified advice be NOT a recommendation?
What chance do we have in the Regulator can’t be crystal clear on what can and can’t be provided?
Surely Webb and the FCA can agree, that if a simplified approach is required
1) The FCA needs to publish a procedure which if followed, will protect the firm from challenges that it failed to take everything to account
2) FOS needs to be told – if the rules are followed – they may not look at anything else – the complaint can only solely about the simple advice area and that’s what they look at. (As this will help ensure ‘Limited or Simplified’ Advice doesn’t become ‘Why didn’t you look into this’).
If firms then follow the FCA path on Simplified Advice – it should be profitable to the firm, suitable for the target market and be a win for the government. BUT the FCA and FOS have to work together and agree the rules are fixed and no matter what the complainant says – they stick to the rules (the procedures will state – there may be other aspects which will affect the suitability of this advice – if you are concerned about them – ask your adviser etc).
Paul’s comments fall in the same folder as my criticisms of the Regulator for muddying the waters on regulated and non-regulated advice on workplace pensions, we need a single definition of “advice” to me it is the delivery of a definitive course of action- e.g. a recommendation.
What Paul is calling for is a “safe-harbour” where an adviser can sit immune from the storms of protest, provided he has followed the rules. If the rules are not clear, there can be no safe harbour.
It is impossible to imagine a world where people will not want recommendations. Those walking through the doors of the Citizens Advice Bureau will not be expecting another door with “Citizen’s Guidance” over it. They will want to be told what to do- if only to go and get advice (simplified or otherwise).
My feeling is that people will then ask – what can I do without advice (which I don’t want to pay for) and the person giving the guidance will have to shut up. Because if you want a pension without advice you are back in the rough seas of “non-advised” annuities or the iceburg-ridden waters of “non-advised” drawdown – or you are in the Lamborghini showroom.
Which brings me back to Steve Bee, with whom I had a good old fashioned argument about non-advised products which concluded in us shaking hands, him drawing a nice picture on a napkin and us agreeing to work more closely in future.
For the record, I don’t see how anyone would pay for simplified advice if it didn’t tell you what to do, and frankly I don’t think simplified advice can do much that you couldn’t glean for nothing on the pages of http://www.moneysavingexpert.com . Those who want to pay for advice have either so much money that the cost is irrelevant or such vanity that they feel they ought to have a financial adviser, I neither have the money or the inclination to take financial advice but were that to change, I would like an adviser like Mr Bee, with whom it is very nice to spend an afternoon in Bermondsey.