If an independent body is not appointed to monitor the regulator's performance, the Association of Professional Advisers (APFA) will take on the task itself, the body's chairman told members in a defiant speech last night.
Chairman Lord Deben told APFA members at the group's annual gala dinner that it would take on the task of monitoring the regulator if no other independent body was appointed to do so.
Deben explained that APFA would look at three measures when assessing the regulator's performance: "We would ask, does the action of the regulator improve acceess and protection of the consumer; does it improve the savings ratio; and does it mean that more people get professional advice than was once the case."
"It's an objective, simple and clear demand and we want it not for ourselves but for the financial future of the United Kingdom," he added.
In a speech that emotively referenced a tarnished UK's future if the savings gap is not addressed, Lord Deben also implicitly criticised the way advisers have been penalised for product failures in the past.
"If an adviser recommends a regulated product from a regulated firm in the UK with a reasonable track record and with a prospectus that meets the requirements, and then the business misleads the public or changes the terms such that it moves from a low risk to a high risk product, the fault lies with the company that produces the product ...and not [the adviser]. And this is true because it doesn't anywhere else in life."
To address issues such as advisers leaving the industry, and concerns around the paucity of new entrants, Deben said that regulator must ensure "that we don't have a cost of compensation [for products such as Keydata and Arch Cru] so heavy that those who have done the right thing are penalised to a degree that can no longer carry on in business."
"Secondly, [the regulator must realise] that we cannot have a system in which year by year, fewer and fewer people bear a bigger and bigger burden and so are so less able to do the job they want to do."
