Senior Conservative MPs are “appalled” at the in-fighting and lack of focus within the IFA sector, according to Michael Johnson, a research fellow at the Centre for Policy Studies.
Johnson was secretary of the Economic Competitiveness Policy Group, established by the Tories in 2007 to review the British economy.
Addressing delegates at the Money Marketing Retirement Summit in Dublin last week, Johnson said the evidence session he held with IFAs was by far the worst.
He said: “You need to get your act together and act as one unit. When we were taking evidence in the policy groups, we had hundreds of evidence sessions over two years and the worst session came from the IFA community.
“I sat there with John Redwood and we were appalled at the inconsistency of messages, the in-fighting, the lack of clarity and the lack of any real focus.”
Johnson said IFAs have “surrendered the initiative” on the retail distribution (RDR) to the Financial Services Authority (FSA), which has taken over and implemented its own ideas on how to re-shape the industry. (article continues below)
He said: “Now you have got to work out a strategy as to how you are going to get that back. I have not heard a single word that gives me any actionable ideas as to what you are going to do.
“You have to build trust and only once you have created that trust will you be able to negotiate with the regulator to reduce the regulatory burden.”
Johnson said he believes that, in future, IFAs will move away from the advice area and become purely distributors.
He said: “I think the IFA community may well find itself moving away from advice and become first and foremost distributors. Eventually, they will not offer advice at all.”
Alan Lakey, a partner at Highclere Financial Services, says: “How can IFAs have a unified view? Everyone is concerned about the specific issues affecting their own businesses and that cannot be helped.