On a freezing night in London, as many as 80 MPs, some from as far away as Middlesbrough and East Kilbride in Glasgow, were in the House of Commons to represent the concerns of their constituents about the RDR’s remuneration and qualification proposals.
The debate was called by Baldwin and Garnier, who said they had been “inundated” with letters and phone calls from thousands of advisers fearful of the impact the Review would have on their livelihoods.
At least a dozen MPs used six-minute time slots to call for the FSA to permit ‘grandfathering’ for experienced advisers and rethink the RDR’s adviser charging proposals, which will outlaw commission.
A number of members said consumers should be given the choice to pay via commission or fees, with any commission payments fully disclosed.
It was the first time the Review had been discussed in the Commons Chamber and followed a half-hour debate in Westminster Hall on 20 October.
Financial secretary to the Treasury, Mark Hoban, said he “recognised” the points raised about grandfathering but asked attendees to clarify how much experience would be sufficient to permit unqualified advisers to continue practicing beyond 2012.
He said the regulator had already relaxed its qualification requirements by permitting examination providers to develop non-exam alternatives.
Additionally, Hoban said he did not doubt the integrity of the vast majority of advisers but again referred to examples of past pensions mis-selling as a warning. Adviser charging was necessary to build consumer trust, he said.
More than one MP used the debate to remind Hoban of remarks he made during the Westminster Hall event, when he described the current entry-level qualification requirements for advisers as on a par with those for a McDonald’s shift worker.
However, the debate will largely be remembered for the cross-party support offered to Baldwin and Garnier. MPs from all parties cited the concerns of a number of their constituents.
“Everyone was saying the same things”, Baldwin said, while Garnier described the evening as “an outbreak of unanimity”.
One Labour MP said: “There is so much agreement, this is in danger of becoming a love-in.”
Adviser Simon Kershaw added: “I have never seen such a cross-party consensus on any subject, let alone in a graveyard slot.”
But some argued the debate lacked any real discussion and merely revisited “tired” arguments first mentioned years ago during the early days of the RDR.
Alistair Cunningham, of Surrey-based IFA Wingate Financial Planning, said: “The consistent theme in the RDR debate was that it wasn’t a debate. The anti-RDR lectures would be a better name.”
Martin Bamford, managing director of Informed Choice and a confessed pro-RDR practitioner, added: “A number of the arguments in this debate just go to demonstrate how desperate the anti-RDR lobby have become so late in the day.”
Garnier said the next step would be to wait for the Treasury Select Committee to collate evidence on the impact of the RDR. An oral evidence session may then be possible, he said.
