First things first, thank you to those who wrote last week to check on my health. I’m pleased to say that about 80% of correspondents just took the mick, but 20% or so were genuinely solicitous. To them I send much love, reassurance that it’s not a new and more deadly form of Covid, and the gentle guidance that it’s probably best not to take too much of the opening paragraphs of the Update seriously. For example, you can’t know for sure if that 80/20 figure is correct. It might have been 60/40. I might only have had one note. Or none at all. In this wilderness of mirrors we must all learn to tolerate ambiguity.
Having made such a fuss of a wee cold last week, it would indeed be ironic – and not in an Alanis way, I mean actually ironic – if I get the bug now, especially as I get to go to London next week to meet people and do things and talk at an event without the stress of it being our own one. The nice thing about doing far, far less travel than in prelapsarian times is that each bit you do is that bit more special. So it’s back on with the hazmat suit.
Talking of ambiguity, we’re in that interesting quantum state of waiting, neither positively nor negatively charged, before we find out what’s in Rishi’s special spring box as I write this. I suppose by the time you read it the contents of the spring statement will have been well leaked, or maybe he’ll have delivered it already.
Whatever the case, there is something rather sweet about how puffed up the pensions sector in particular gets whenever there’s anything resembling a budget going on. Divination, imprecations, warnings, all flying around all over the place but the real story is which provider spokesperson has been left without a chair when the music stopped and therefore has to take his or her turn at the flat-rate-pensions-tax-relief story while everyone else laughs and has drinks. And it never occurs to them that we could just…not.
And on that theme, I’ve been thinking this week about…the advice/guidance perimeter. I know, you thought I was jumping off a different cliff there, but that’s for another day. It was on my mind anyway for a thing, but then this piece from the industry’s very own northern powerhouse, Andy “Andy Bell” Bell popped up as well and I thought ah, we’re onto something here. It’s a very good piece, though (and I don’t want to lift the veil here) I suspect the Friends spine all the way through it was a drop-in from one of Andy’s many fine comms folk. I don’t know what makes me think that.
Andy makes a telling point that it would be a shame if PERG (the line in the sand between advice and not-advice) trampled on the aims of the Consumer Duty. This makes sense to me – back in the mists I used to write a lot and I do mean a lot of workplace pensions comms and any time I got close to saying anything like “this is quite a good pension and your employer pays into it so you probably should too unless you’re very special and if you are you will most likely know you are so just get on with it” then I had to have meetings with risk and compliance people and I really don’t like meetings. (Although I do have a handy hint for how to deal with risk and compliance people: know COBS, PERG and SYSC better than they do. Quote it at will and watch them flounder.)
We’ve always had a problem with the special nature of advice – which can best be summed up as “the ability to sue someone who tells you to do the wrong thing” – trampling over not just optimal client outcomes but basic good sense. We’ve never quite solved it; corporate schemes have had a sort-of carve-out; others have found a way of expressing things that keeps the PERG line as a dot, to use Andy’s very own pop culture reference point.
Most solutions people propose to the PERG conundrum have to do with more carve-outs; getting reassurance from the FCA that it’s cool to say this or that. But I can’t help wondering if some of the answer isn’t on the guidance side of the perimeter, but the advice side. This comes back to the question of what’s more valuable – financial planning or advice? The former, given without a product recommendation, is unregulated and is on the easy side of PERG. The other is not. Most planners will say it’s the plan that matters; the regulated advice bit is boring and grungy and clients don’t care about SIPPs and funds and OCFs and that. I’m not totally sure that’s true, but let it stand for now.
If that is the case, can’t we just build the advice wall higher? Like the big ice wall in the dragon programme. Right now regulated individuals dance with impunity from one side to another; everyone else stays well away because of, I don’t know, the big lads with the bird feather cloaks or something.
Let the unregulated get closer to the perimeter, but if you have to mandate anything mandate that the second the conversation gets to saying “this is a suitable thing for you and you can sue me if I’m wrong” a large metaphorical gong sounds, the metaphorical lights drop and the client realises they are now not-metaphorically in harm’s way. It’s the same sort of thing as we have now, just with clearer separation. In time, firms might work out how to have brilliantly client-relationship driven financial planners who aren’t regulated, working alongside more technically minded folk who are. It might be better.
I know we’re going to hear more on this from the regulator over this year and more. We do need to get better at this, or maybe just braver. Till then, we must continue to learn to tolerate ambiguity.
- I’ve enjoyed poking fun at Andy Bell this week (he can take it) but I can’t do too much as he’s kindly joining us for our next HomeGames 2.0. Natalie takes the helm once again, and our subject is platforms. On the panel are Andy, Verona Kenny of 7IM, Nathan Fryer of PlanWorks and some joker called Polson. It’s on Wednesday April 6 at 12.30pm and you can register here, free as ever.
- New cat alert – we’re awfy happy and proud to be joined by Scott Sinclair, late of Embark and Zurich, and before that the editor of Professional Adviser. Welcome to the big man.
- Here’s a long-read piece from Robert Vaudry of Copia on the DFM market and how to pick the right partner (one suspects “Copia” is the desired answer but it’s a very good piece anyway). This is a subject to which you may be sure we will return.
- We’re hiring! We’re looking for as many as a few new folk, particularly in our communications and PR business which is doing a burgeon again. Find out more here.
- And your music choice this week? Sometimes you just want something absolutely filthy, and there is no better place to turn than the Evil Elvis himself, Glenn Danzig. Here’s 777 from his sweet-treats record Lucifuge, and it is best enjoyed at neighbour-bothering volume. Seven on the grandest scale indeed. Oh, and if you’d like a very different take on the same song, then try this out. It is, if anything, even crazier.
See you next week, when one of m’colleagues will Update you.