Investors who lost money after the Connaught Income Fund collapse are still waiting for compensation, as FCA work to “arrange the distributions” of payments continues.

The regulator says a previous statement – made to the Complaints Commissioner – referred to the fact the process of calculating redress had begun, rather than payments being made.

The FCA ruled in November that Capita Financial Managers Limited, the fund’s authorised corporate director, should pay affected investors compensation worth up to £66m by 31 March.

Agents Duff and Phelps, who were the liquidators of Connaught’s income Funds, are currently calculating individual payments.

Investors should get their capital refunded, with interest, calculated at a simple rate of 0.52 per cent. Any income received, distributions or dividends paid by the liquidator, or compensation payments will be deducted from the final settlement.

A number of complaints have been made about the FCA’s handling of the collapse of these funds. These have not been upheld by the Complaints Commissioner, although it has said a third party review will take place after the FCA has closed its investigations.

In 2015 the FCA started an investigation into CFM after the Connaught Income Series 1 fund – which invested in high risk loans – lost £110m after the fund was suspended in 2012.

Connaught entered administration in September 2012 after the failure of its Income Series 1,2 and 3 fund.

In November the FCA released a critical report on CFM saying it did not conduct adequate due diligence on the fund and failed to communicates its processes properly to investors.

The FCA would normally charge a penalty for the failing but decided to only issue a public censure in relation of the firm, as it would not have been able to pay this on top of the £66m compensation.

A financial adviser – who asked not to be named – says he hopes there would be no further delay, and payments made promptly to investors by the end of March.

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Major providers look to shake up market

Two major providers are mooting the launch of flexible drawdown products, but commentators are sceptical as to whether they will ever get off the ground.

Last week Money Marketing revealed that both Legal & General and Scottish Widows could expand into hybrid retirement products. But, with a number of major providers having already pulled out of the market, advisers have questioned whether there is any client appetite for these so-called third way retirement offerings.

Also known as unit-linked guarantees, guaranteed or hybrid drawdown aims to combine the investment benefits of pension drawdown with an annuity to provide a guaranteed income until death.

Back in 2015, it was thought that such products could be the perfect solution for clients facing the challenges brought by managing their portfolios under new pension freedom rules.

In reality, the innovation has been something of a damp squib, with major providers abandoning the market. MetLife, which sold guaranteed drawdown to around 50,000 customers, withdrew from the market last summer. The provider, which says it has no current plans to re-enter the market, said at the time: “The ongoing challenge of long-term low interest rates has made it difficult to deliver value.”

The providers that have attempted to crack the market so far have been varied in their approach, but the one thing they all had in common was higher fees and a lack of take up. Typically, these packages come at a cost premium of around 1 to 1.5 per cent a year, market experts say, setting the bar high for what they must provide to be a viable solution.

LangCat principal Mark Polson says: “You can talk about the case for these products intellectually, and it’s interesting and it all makes sense, but the problem is they are complex, expensive to build and there is a lot of cynicism from advisers.”

Adviser scepticism has been a major stumbling block so far, with many citing fees and complexity as prime reasons for shunning the market. Another issue is that the building blocks of hybrids – stock market exposure combined with guarantees – are all too reminiscent of with-profits funds, and advisers may be wary about backing something similar to a product that has courted controversy.

But as well as that, many advisers argue that they can do what these products promise for themselves, without paying the premium for the package. AJ Bell pensions analyst Tom Selby says: “There is nothing preventing an adviser combining the flexibility of drawdown and the security of an annuity for a client without paying an insurer a premium to package them together.”

Polson adds: “In general, complex products that achieve the same result as a combination of a few simple things are not really wanted. If you can get an adviser who can manage drawdown and volatility, they can probably generate a better return.”

Delivering value

It could be argued, though, that such a ready-made package could suit those savers in the advice gap, who either can’t afford or don’t want to pay for the expertise of an adviser. But whichever route providers use to reach the consumer, price has been a major obstacle.

At a time when there is an increasing focus on fees and charges, and providing clients with value for money, justifying a high-cost product can be difficult. Aspect 8 chartered financial planner Claire Walsh says: “Hybrids sound like a good idea in theory but whenever I considere

d the MetLife products it just never stacked up – and now it’s withdrawn from the market. The cost of the guarantee, and the fact that you can’t often guarantee the result, doesn’t tend to be worth as much as the fee.”

This becomes a vicious cycle, as higher costs put advisers and clients off, which in turn stops providers from reaching a critical mass where they can reduce the costs. FinalytiQ director Abraham Okusanya says: “You can have a new product but if not enough people buy it then it’s going to be very expensive for the few who do.”

Polson adds: “I don’t think providers have made these products unnecessarily expensive, I think it reflects the fact they are expensive to build and manage. But that means you need to know you’re going to sell lots of them to make it economic.

“To be fair, the products out there do work and do what they’re supposed to do. The problem is they come at a cost, and it’s not necessarily the case that they will provide the best possible return, but that’s not really what they are for.”

Polson believes there is a gap in the market for the provider that can create the right solution. “I think there is a pent-up demand for something which will take care of the retirement journey, particularly as we head into less certain and more volatile times, savers are looking for a more stable ride,” he says.

Yellow Tail Financial Planning director Dennis Hall says a deferred annuity contract might be of more interest to clients than guaranteed drawdown. “Right now, I don’t see hybrids becoming a big part of the market; I haven’t seen an appetite for it. The price premium on these products is a cost drag, and in a low yield, low interest rate environment, that’s a problem,” he says.

Plan Money director Pete Chadborn adds: “An instance where a hybrid product is a valid solution is if the client is phasing into retirement and reducing their earned income. But costs are always a concern, particularly if the outcome can be achieved for less with standalone drawdown and annuity products.”

The annuity puzzle

Some 68 per cent of 1,200 consumers aged 50 to 75 surveyed by PricewaterhouseCoopers when pension freedoms were introduced in 2015 said certainty of income was an important factor in how they would manage their pension.

Meanwhile, 61 per cent were concerned about life expectancy and how long their savings would have to last. Almost half (45 per cent) were concerned about investment risks and protecting their wealth, with a further 38 per cent worried about the erosive effects of inflation.

36 per cent also wanted a simple retirement product that they could easily understand.

Guaranteed drawdown does seem to tick a lot of the boxes for this
retirement income wish list – apart from the demand for simplicity – so providers are not yet giving up on the market.

L&G retail retirement chief executive Chris Knight says: “Annuity products have a vital role to play in retirement and the security of a guaranteed income in later life should not be underestimated.

“There’s a need for more innovation in the annuities market. The need for a simple and easier to understand product, solutions for maturing defined contribution customers and the potential for a guaranteed income annuity that addresses care costs are all areas we are actively investigating.”

While L&G and Scottish Widows are not yet forthcoming with the details on their potential launches – the latter says it is “reviewing its offering” in the drawdown market – advisers are still waiting for news of offerings from Old Mutual and others, which are believed to have stalled.

Some commentators believe that few providers will make it to the point of an actual launch, put off by adviser agnosticism and the retreat of their rivals. “I think it could be another instance where they end up shelving the idea,” says Hall.

But there is certainly growing pressure on the industry to create solutions for clients, which will provide a sustainable income over a longer retirement. The FCA has expressed concern about the lack of innovation since pension freedoms were introduced. In a recent report it said: “We have not seen products emerge for the mass market that combine flexibility with an element of guaranteed income.”

Scottish Widows head of fund proposition Iain McGowan says: “The main innovative challenge lies in the competing needs to be met: people want some control of their pension fund but are concerned about running out of money before they die.”

But Selby thinks providers need to focus on getting the basics right first, while the regulator should be focused on keeping costs low and encouraging people to save.

He says: “There is a danger in chasing shiny new solutions rather than doing the basics really well. Ultimately there is no product that can turn a tiny pension pot into a massive one.”

Other experts agree that providers and policymakers could be better spending their time on different issues; Walsh would like to see Nest develop a low-cost drawdown product, for example, while others would like to see the introduction of default drawdown investment choices. Not only could such innovations be more achievable, they could also be more helpful to savers.

Okusanya says: “I hope I’m wrong and that someone comes to the market with a really good product that combines longevity protection and flexibility but, from what I’ve seen so far, it doesn’t seem likely.

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Just a few weeks into implementation, it is clear Mifid II will continue to challenge the industry for some time to come

The pursuit of greater transparency for consumers should of course be welcomed. However, the UK financial services sector was always going to encounter some unique challenges in trying to implement the new Mifid II regime, given its scope and complexity, with rules designed for the European Union market.Investment platforms, fund managers, advisers and other key parties all have responsibilities for implementing changes, which in many cases are inter-connected.

So what have been the stand out issues we have seen so far?

Product governance

The product governance requirements apply to both Mifid and non-Mifid investment firms. They cover advised sales, non-advised sales and undertaking discretionary investment management. The rules also apply to distributors and manufacturers, albeit to differing degrees.

Fund managers’ fees outed as Mifid II disclosure rules take effect

It appears the industry has struggled to understand the scope of products affected and how to approach the assessment needed to be carried out. This currently covers financial instruments – including funds – but when the Insurance Distribution Directive comes into force it will broaden to cover a wider range of insurance-based products.

Product governance assessments can look daunting at first but it is simply about examining the products and funds you are looking to recommend. Further simplification can be obtained by grouping these funds into different categories as part of the research process.

To comply with the product governance requirements, advisers need to consider which target market it is likely to be suitable for. Ensure the distribution meets that target market’s needs. Regularly reviewing products will help to ensure they remain consistent with the target market’s needs and, if necessary, will enable changes to be made to the distribution strategy if any problems are identified.

‘Bizarre at best’: Industry offers mixed reaction as Mifid II comes into force

The key for advisers is to choose the appropriate distribution strategy so the client’s best interests are taken into account based on the product and its composition.

Aggregated costs and charges

Mifid requires firms to aggregate costs and charges information and disclose this to their clients, as the aim is to provide additional transparency. But it also imposes a range of obligations, including:

• Aggregated total costs and charges associated with the financial instrument (e.g. collective investment, shares, etc), investment services and any ancillary services.
• The disclosure needs to be given as a percentage and a cash amount.
• The information needs to be given pre-sale (ex-ante) and, where the firm has an ongoing relationship with the client, on a post-sale basis (ex-post). Furthermore, any ex-post disclosures must be given at least annually.The problem from the outset has been a lack of detailed practical guidance as to how to meet the new disclosures.

This has meant that firms have been left to derive their own solutions, with a number of different approaches emerging across the market.

Data gathering is required to perform the necessary calculations that feed into the disclosures. This involves input from various third parties, including platforms and fund managers, creating an industry-wide challenge.

Advisers should be giving clients an indication of the impact on their investment of the overall charges, but compiling all these different pieces of information in order to calculate such a figure is quite a challenge.

Graham Bentley: Why all advisers must adopt Mifid II 10 per cent warning rule

While some platforms have produced calculators, it only relates to them and it is based on their interpretation of the rules.

In addition, some fund managers have not been ready for Mifid and have not been in a position to provide the full charging information, which means advisers have been left unable to produce a clear and comprehensive best-fit calculation. The responsibility to disclose ultimately belongs to the advising firm.

Firms need a uniformed approach, which delivers a consistent, robust and repeatable process. Expect to see further support and new initiatives emerging to help.

Firms will also need to challenge and test the changes they have made to ensure they can withstand regulatory scrutiny further down the line, when the inevitable implementation reviews take place.

Mifid II has set the tone for the year ahead. It will soon be followed by more regulatory changes that will exert further pressure on advice firms to manage their risks, while remaining efficient and profitable. Another year of challenge and opportunity awaits.

Julie Sadler is managing director at Bankhall

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Adviser’s overuse of financial jargon, a lack of confidence, and an increased perception of risk have led to a disparity in the uptake of investment advice between men and women, research from HSBC shows.

The HSBC data shows women are more likely to think their friends and family do not want to talk about investing, and would not encourage it for their current life stage or lifestyle than men.

Women also find financial jargon more off-putting than men with more than a third of females (35 per cent) saying they felt like this compared with a quarter (26 per cent) of men.

The HSBC report into investment advice found women are generally less confident than men when it comes to the investment process, despite having equal necessary investment knowledge.

The research found a lack of time is also a barrier to women investing, with 17 per cent of women spending more than a month researching investment options, compared to 13 per cent of men.

Nearly three quarters (72 per cent) of women say they do not want to take investment risks, compared with 54 per cent of men.

Women’s pensions a third the size of men’s

HSBC head of premier and wealth insights Michelle Andrews says: “While gender does not define the way we manage our money, there are subtle but notable factors that may put some women off investing.”

“Unlocking the investment potential of female customers will not only benefit UK society as a whole, allowing women to invest more easily and with more confidence to deliver multiple economic and social benefits for the UK, but it will also benefit the bank commercially.”

HSBC worked with YouGov to speak to 2000 UK investors, as well as conducting customer interviews and speaking to its own staff.

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River and Mercantile Asset Management high profile portfolio manager Philip Rodrigs has been ousted from the business with immediate effect following an investigation into “a professional conduct” matter.

Since December 2017, the company at the £32.6bn fund group has been investigating Rodrigs and found he was “incompatible with the high standards and expectations we hold”, the firm says, but couldn’t reveal the exact motives behind the disciplinary action.

Rodrigs, who joined the firm in 2014 as a partner from Investec, was lead manager on three funds at the group; the R&M UK Equity Smaller Companies, the R&M UK Dynamic Equity, and the R&M UK Micro Cap Investment Company Limited funds.

The company says the disciplinary action was not related to his work as fund manager and that either the net asset value of the funds or clients have been affected by the decision.

RAMAM chief executive officer James Barham says: “It is disappointing to have to take this course of action but we have acted swiftly to ensure that the portfolios continue to be managed in line with our PVT investment philosophy and process. This will ensure that we continue to deliver market leading investment returns for our clients.”

The responsibility for running the three funds have been distributed internally to other fund managers. The firm says the succession for Rodrigs was in the plans for “a while”.

Dan Hanbury will manage theR&M UK Equity Smaller Companies as he did prior Rodrigs’ appointment,  the multi-cap R&M UK Dynamic Equity fund will be managed by William Lough, and management of the R&M UK Micro Cap Investment Company Limited fund will be run by George Ensor.

Barham adds:“It is always frustrating to have to announce changes to the portfolio management team, especially as we have always maintained a very strong investment platform.

“However, our potential, valuation and timing investment approach will continue to be applied in the same robust and consistent manner to ensure that the excellent track record we have thus far achieved, in which every one of our portfolios has outperformed its benchmark since inception, continues.”

“A big shock”

As a result of Rodrigs’ departure, Hargreaves Lansdown has removed the fund from its Wealth 150 list. Senior analyst Laith Khalaf says: “We are looking for the managers with a long track record. Unless the manager who takes over the fund has equal experience, we will take the fund off the list.

“We will inform everyone who holds the fund [of our decision].”

Tilney Group managing director Jason Hollands says the news comes as “a big news shock” for the UK asset management industry.

He says: “Rodrigs was widely seen as one of the rising stars of UK equity fund management who earned his spurs at Investec where he initially focused on UK smaller companies but had expanded his repertoire out to manage multi-cap UK equity funds. At River & Mercantile he had assumed responsibility for the River & Mercantile UK Dynamic fund while continuing to manager the R&M UK Equity Smaller Companies fund. Neither of these funds were on Tilney’s ‘buy list’ but had started to deliver some impressive performance since taking over the UK Dynamic fund.

“I think most advisers who have supported these funds will want to meet the managers rather than rush hastily into to a decision, which is sensible.”

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An IFA firm that was critical of the media’s coverage of the British Steel pension scandal has stopped advising on pension transfers, following intervention from the regulator.

The firm, County Capital Wealth Management – which also trades as The Pension Review Service – says it has voluntary suspended its pension transfer permissions, but expects this to be temporary.

Speaking to Money Marketing, County Capital Wealth Management managing director Mark Abley says: “This is part of our ongoing discussions with the regulator.”

He says the FCA feedback related to “technical aspects” of the DB transfer process, adding “there was no question of customer detriment”.

Abley adds: “We are not seeing this as a negative thing, but as a positive way to make these improvements to our processes. We have listened to the regulator’s feedback and look forward to getting our permissions reinstated in the very near future.”

In December the firm submitted a letter to the Work and Pensions Select Committee, saying that advisers were subject to a “trial by Twitter” over the advice given to British Steel pension members.

The letter said reporting of problems with advice given to BSPS members had “bordered on the hysterical”.

It adds: “Advice firms have had their reputations tarnished by their involvement in the process. Most of these firms are well run and offer good, sound and practical advice.”

The advisory firm has three authorised individuals and employs 15 staff. It is based in County Durham and also has offices in Scunthorpe and London. It has offered advice to a number of members of the BSPS – which is in the process of restructuring.

Several advisory firms have stopped offering advice on DB transfers followed investigations by the FCA. Many of these investigations have focused on firms that have given advice to BSPS members – amid concerns about the quality of this advice, and fears that members are being wrongly advised to transfer out of this DB scheme.

The Work and Pensions Committee has been highly critical of how the FCA has handled this emerging issue, and urged it to review all firms offering advice to BSPS members.

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Money passed on via inheritances is set to double in the next 20 years as baby boomers pass away. Make sure their children are clients.

Advisers with an eye to building the long-term value in their business will be very clear about their current client base and will have a strategy for protecting and increasing the advice fee flow, assets under management and influence they generate.

People (especially richer people) are living longer and the choices involving their finances are increasing. All this bodes well for existing clients’ future need for advice.

The positive difference in a client’s net return after advice costs represents the advice alpha. This alpha comes from the better decisions and greater engagement with finances that having a good adviser relationship delivers. And most agree proving value will be even more important in this new Mifid II world.

Claire Trott: Cashing in on intergenerational planning opportunities

But there are also risks for advisers with ageing client bases. Longevity is one thing but, ultimately, we are all going to die.

For a business to avoid gradually going out of existence with its client base, a strategy for attracting new, ideally younger, clients will be important to complement the retention of existing ones.

The most obvious starting point for many advisers will be the children and grandchildren of existing clients. But the way in which younger clients can be best engaged needs a bit of thinking about.

Much has been written about the preferences of millennials in this regard. Some form of online or robo strategy would seem to be important as a means of initial engagement.

Without some form of appropriate and relevant relationship at an early stage, the delivery of face-to-face/more traditional advice when it is needed is much less likely.

A number of traditional advice and wealth management firms are recognising this in their acquisition and capability-development strategies.
With these components in place, businesses should be well positioned to capitalise on a potential flow of funds to invest through inheritance.

Tony Wickenden: Do clients know enough about IHT reliefs?

A recent study published by the Resolution Foundation found that the amount of money passed on through inheritance each year has doubled over the past two decades, and will more than double again over the next 20 years as wealthy baby boomers pass away.

Interestingly, however, based on the age and life expectancy of their parents, the estimated average age to inherit will be 61. And, of course, there is also the cost of care factor to take account of.

Nevertheless, property and pensions seem to be the main drivers of this expected inheritance flow. According to Resolution, home ownership rates increased rapidly for people born before, during and after the Second World War, peaking at around 75 per cent among baby boomers born between 1946 and 1965 – who were also the main beneficiaries of generous defined benefit pension schemes. This group now holds more than half of all the wealth in Britain.

Each successive generation following those born in 1955 has accumulated less wealth by a given age than their predecessors did at the same age.

According to a separate Resolution report, less than a third of millennials own their own home by the age of 30, compared with around 55 per cent of baby boomers at the same age.

Many of you with grown-up children will associate with this, and the associated trend of parental provision of deposit and/or help with paying or guaranteeing a mortgage for their kids.

That said, the children of baby boomers are more likely to benefit from an inheritance than their predecessors, and that inheritance is likely to be larger. If that turns out to be true, having a prior relationship with these inheritors will be essential.

Tony Wickenden is joint managing director of Technical Connection. You can find him Tweeting @tecconn

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With delegation the key to business success, many advisers should consider getting extra support

The most common challenge advisers face when it comes to running their business is making the time to do so as effectively as possible.

Many want more profitable and productive firms but know that further developments are often required to maximise efficiencies.

Since the implementation of the RDR, reports have highlighted how the average proportion of advising staff to non-advising staff within firms has been reducing.

Perhaps this is due to the volume of work required by firms to meet regulatory demands and the like. But it could also be that advisers are beginning to work smarter and invest in the support needed to free up more of their time to develop their business.

The majority of advisers would admit that delegating is not their forte. They would also admit they take on far more administrative work than they should. But such highly skilled professionals should spend their time on what adds the most value to their business.

There are various options advisers can take to give them more support.

Outsourcing

For those who have been used to working alone, it may be too much of a jump to take on a full-time member of staff straightaway. Why not consider outsourcing work to an individual or company providing support services?

Outsourcing work can be done on a case-by-case or hourly basis, or to a specific budget, and the costs associated are not as high as one might assume. Besides, the benefits of delegating administrative work should well outweigh the costs involved.

Outsourcing work does not usually require an adviser to provide much training. Individuals and organisations offering this type of work will already be trained to a certain level and may even provide the adviser with ideas of how they could do things differently.

Of course, the adviser can request work is done in a certain way if necessary, but the more bespoke the requirements are, the longer it may take to build the relationships needed.

Once outsourcing is being utilised to a high degree, it may reach a tipping point where actually recruiting someone into the business would be a better option.

Recruiting

For small firms, recruiting someone new is a major commitment, so the decision should not be taken lightly. This is not just a commitment in monetary terms but also with the training and development required to nurture the individual to manage the work to the desired standard.

It is about finding the right balance. Firms could choose to recruit someone with very little experience or expertise, which would prove more cost-effective, but would consume more time and energy in upskilling.

Alternatively, they may choose someone who has the skill and experience for the role, which would demand a higher remuneration package, but could reduce the amount of training and development required.

Most important is making sure the person is the right fit for the business.

Taking on a new recruit is an investment and should feel like a partnership. Paying someone appropriately and treating them well should result in stronger commitment for the longer term.

There should also be no hesitation in developing someone to improve in their role. This often does not happen because the employer is worried the employee may leave the business with more skills and experience. But, as Richard Branson once said: “Train people well enough so they can leave, but treat them well enough that they don’t want to.”

Advisers need to be taking a good look at their businesses and be honest about the amount of work they are doing that they should not be. Look at options of outsourcing or recruiting someone to deal with the administrative burden.

Yes, investment in cost and time is required, but the benefits should outweigh these inputs by maximising profitability and business efficiency.

Tom Hegarty is managing director at New Model Business Academy

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International advice firm deVere is expanding its graduate training programme in a bid to plug “the impending financial adviser gap”.

The firm says it will be looking to take on around 125 graduates this year, a significant increase on the 94 graduates who filled the programme in 2017.

Trainees will work in many of the company’s international offices, including placements in Malta, Dubai, Malaga, Sydney and New York.

This expansion comes after a more difficult year for deVere.

In 2017 it announced that it would be closing offices following a change to the way overseas pensions – or QROPS – are taxed. At the time deVere said QROPS represented about 20 per cent of its business, although many were based in the EEA, so were unaffected by these changes.

The company also stopped providing pension transfer reports in February 2017 while the FCA conducted a “skilled person review” into the firm’s pension transfer advice.

deVere Group’s founder and chief executive Nigel Green says: “There is a pressing need for the sector to set-up and train and recruit the next generation of wealth management professionals to fill the impending adviser gap.”

He says this gap is being exacerbated by many advisers leaving the industry – due to retirement or the pressures of increasing regulation.

He adds: “At the same time global demand for sound financial advice was growing, with the baby boomer generation now heading into retirement and financial technology advances.”

Green adds: “We are confident we can attract the best grads to become the new industry leaders as deVere is heavily focused on new fintech solutions which we believe are the future of the industry.

“We provide hands-on experience, in-depth mentoring, training from leading institutions, the opportunity to work all over the world as well as formal industry qualifications.”

For example the adviser, which focuses on high net worth clients has recently launches In recent the month the adviser has launched a new crypto-currency app for customers.

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The Government’s promise of “enhanced rights” for millions of UK workers does little to address the problem of pension provision for the self-employed, Steve Webb says.

In its response to the Taylor report published today, the Government says “major reforms” will give millions of workers new rights and these “are a vital part” of the country’s industrial strategy.

Last July the Royal Society of Arts chief executive Matthew Taylor released a Government commissioned report into modern work practices.

It said the self-employed should receive the same benefits as those that are employed and made policy recommendations to achieve this.

In some cases the Government says it plans to go further than the Taylor report’s proposals including enforcing vulnerable workers’ holiday and sick pay for the first time.

It will seek to protect workers’ rights by introducing a new naming scheme for employers who fail to pay employment tribunal awards and quadruple employment tribunal fines for employers showing malice to £20,000.

The Government also wants a list of day-one rights including holiday and sick pay entitlements and a new right to a payslip for all workers, including casual and zero-hour workers.

Although Royal London director of policy Steve Webb welcomes the proposals he worries they do not address the lack of pensions provision among the self-employed.

He says: “Despite Matthew Taylor’s recommendations, the Government response offers little hope for improving the pensions of the self-employed.”

Today the Office for National Statistics published data on trends in self-employment which shows 45 per cent of 35 to 54 year olds and 30 per cent of 55 year olds and above have no pension savings.

The number of self-employed has increased from 3.3 million in 2001 to 4.8 million 2017 which means the self-employed are now 15.1 per cent of the total labour force.

Webb adds: “The Government’s automatic enrolment review merely proposed some further research and testing on pensions and the self-employed, which is not up to the urgency of the problem.

“Pension membership amongst employed workers has soared because of automatic enrolment, but it remains shockingly low for the self-employed. It is very worrying that this issue has again been kicked ‘into the long grass’, meaning that millions of self-employed people face an insecure retirement’.

The Government will launch a number of consultations to inform what the future of the UK workforce looks like.

These include a consultation on enforcement of employment rights recommendations, one on agency workers recommendations, another on ways to increase transparency in the UK labour market and a final one on employment status.

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The FCA has survived a complaint where a firm wanted a fee charged for cancelling its authorisation refunded.

The firm was charged a £1,300 fee after it missed the deadline to have its FCA authorisation cancelled.

The firm initially complained to the FCA saying it was unfair the fee was charged because it understood it had a different deadline.

The firm also complained that the impact of European directive Mifid II meant its business was no longer viable and the size of the fee did not take into account a recent fall in revenue.

The FCA initially rejected the complaint and it was then referred to the Complaints Commissioner.

In his decision, Complaints Commissioner Antony Townsend says it would have been helpful it the 31 March deadline had been explained to the firm on the two telephone calls it had with the FCA but that it “made no practical difference” because the cut-off had already been missed.

The FCA’s published policy is that a firm is liable to pay a full year’s fee unless they apply to cancel their authorisation before 1 April in any year.

In relation to the size of the fee, the Complaints Commissioner says the FCA’s policy on authorisation fees is clear – fees are calculated according to a firm’s income and the complainant firm was already being charged the minimum fee.

Townsend did not uphold the complaint.

The decision says: “There is a legitimate debate about whether the FCA’s fee charging policy ought to be changed; but I am afraid that this complaints scheme is not the means by which policies are changed – although information from complaints can and should inform the FCA’s policies.”

It adds: “I can see from the FCA’s records that staff have been reminded that they should explain the 31 March deadline in cases such as yours. The fact remains that the FCA has treated you in accordance with its published policies, which apply to all firms.”

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The benefits of advice are clear, yet the industry still struggles to get consumers through the door

As someone who is now accustomed to being variously described as “seasoned”, “experienced” and, in one case, a “veteran” of the industry, it is safe to assume I know something about the world advisers inhabit.

Indeed, 30 years have passed since I began my career as a graduate trainee at a long defunct mutual insurance provider. During this time, two things have remained constant: regulation and a need to engage with consumers in a meaningful way.

There is no doubt regulation has hugely improved the levels of protection afforded the consumer. So is it reasonable to assume we should expect to see greater numbers of consumers seeking advice, knowing they are protected if things go wrong?

Unfortunately, there is little to show in terms of a correlation, and one of the areas I want to explore here is how, as an industry, we can better engage with consumers.

Malcolm Kerr: Hybrid model is future for advice firms

The FCA aims to promote effective competition in the interests of consumers on the basis they are empowered, as well as informed when competition works well. As advisers, we must look at what we can do to better support engagement.

Let us start with some good news: the latest Platforum Consumer Insights report confirms that the tendency for consumers to be entirely self‐directed decreased in 2017. This contrasts with a substantial increase that Platforum saw a year ago. Similarly, the proportion of entirely advised investors fell off considerably a year ago but the latest figure is back in line with previous years.

Nevertheless, the report highlighted that one third of British investors deal with their investments themselves with no help or advice from experts, whereas less than one fifth leave it all to an expert and have as little to do with it as possible.

It did also find that the future intentions of cash savers who are thinking about investing suggests there is a healthy pipeline of potential new clients that may need advice. However, every silver lining has a cloud, and this one’s can be seen in the finding that half of these investors are likely to go to a high street bank, compared to one fifth who would go to an adviser.

Three advisers going the extra mile for clients

It is disappointing that more people do not go to an adviser, since advice has clear benefits.

Indeed, research published by the International Longevity Centre and Royal London last year found that those who received financial advice between 2001 and 2007 compared to those who did not were, on average, £40,000 better off by 2012 to 2014, and had accumulated significantly more liquid financial assets and pension wealth.

In the words of the report’s author, Ben Franklin: “The clear challenge facing the industry, regulator and government is therefore to get more people through the ‘front door’ in the first place.”

Yes, it is disappointing indeed. I would be interested to hear your views as to the tangible steps we can take to improve matters.

Tim Sargisson is chief executive officer at Sandringham

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I recently did some volunteering with the Personal Finance Society in helping facilitate its Discover Fortunes game at a school.

For those of you who do not know much about it, it is a two-hour session that encourages sixth form students to think about a career in personal finance and listen to a financial adviser speak for about 90 seconds – but for the most part it is an interactive board game that requires priorities to be established in five different financial planning scenarios described via a cool cartoon-based video.

As you can imagine, it is very engaging for the students competing in teams, with the ability to use a joker card and a prize up for grabs. I last did it over six years ago at the PFS’ inaugural event and the format has not changed. The kids still love it.

Like most advisers, I find it hard to find the time or to allow myself to be distracted but this particular session was nothing ordinary – it was with my old secondary school. Until now, the plausible excuses had got in the way: I had to get to get other things done, charity begins at home, the list goes on. For many years, I had done enough pro bono with first meetings that did not lead to paid work. I had enough excuses to justify sitting on the sidelines.

But it should not have taken a bit of nostalgia to get me going again. Volunteering and conveying your work skills is a valuable gift – in this case to young people. Plenty of advisers get involved in not only this but the Citizens Advice Bureau, Age UK, taking up positions in professional bodies, and so on.

In a world where keyboard warriors now find it so easy to criticise or moan, to go out and actually do something that is truly giving speaks volumes and is, in turn, enormously fulfilling.

There can even be some pounds and pence in this if you really want to leverage it. A photo and a bit of commentary in various places can be done gracefully. There is plenty who are humble or discrete about their volunteering but there is nothing wrong in spreading a bit of good news that benefits all concerned.

How else are potential clients going to find out how much you care, if that is what important to them? For others, it is a way of planting a thought. They might just volunteer for something that matters to them.

As I circled the circumference of the school to see what building work has taken place since my time there, I bumped into a group of students that had taken part in the session. Expecting an elastic band to whack against my ear, the encounter took me by surprise: “Thanks for taking time out of your day, sir”. Far more polite than me and my pals ever were.

And as I look at the paraplanners around the office going great guns, there is plenty of hope for the personal finance profession.

Mel Kenny is a Chartered Financial Planner at Radcliffe & Newlands

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Financial advisers, it would seem, just want the UK to get on with Brexit. These are the findings of Money Marketing’s latest survey, in which we questioned nearly 400 advisers up and down the country about their view on the most significant political change the UK has seen for decades.

Despite the group leaning toward the remain camp – nearly 60 per cent of advisers expressed this view – almost half (49 per cent) say they do not want a second referendum.

However, worries about the impact the UK leaving the European Union could have on advisory practices do persist, with continued uncertainty around trade and regulation weighing heavily on advisers’ minds.

The perceived intransigence of EU negotiators is hardening opinion, as is negative rhetoric and infighting among UK politicians. Financial advisers, like many other people living the UK, are now looking hard for the light at the end of the Eurotunnel.

Business impact

One of the most important aspects of Brexit is the effect it could have on UK employers and jobs. For advisers, this impact has, to date, been neutral. Nearly 70 per cent of advisers told us that, so far, the UK’s impending exit from the EU has not impacted their jobs, while two thirds (63 per cent) told us their companies and employers are also unaffected. Moreover, around 45 per cent believe they will be unaffected after Brexit.

While some might see this as complacency, according to Pimfa deputy chief executive John Barrass, this is, in fact, a fair assessment.

Barrass says: “Brexit is clearly affecting everybody. However, the majority of our members conduct little cross-border business so will unlikely be affected by any change to things like financial passporting, for example.”

Barretts Financial Solutions managing director Kim Barrett agrees. He says: “The financial adviser is fairly unique to the UK – Europe doesn’t really have a similar model – and almost everything we do is overseen by the FCA. So I don’t see it having much of an effect.”

However, for those that have seen a Brexit effect, more advisers do report negative consequences than positive, with nearly one fifth stating that Brexit has already had a slight or strongly negative effect on their jobs and employers (versus around 13 per cent reporting positive impacts). Furthermore, more than 40 per cent of advisers say their companies would be hurt by a messy EU divorce.

One chief concern for advisers is how Brexit might hurt UK savers’ personal finances – something we are already seeing evidence of in rising inflation as a result of a weaker post-referendum pound.

Rowan Dartington investment director Tim Cockerill says: “The UK is probably going to have slower GDP, people are probably going to earn less, inflation will be higher and so they will start being more cautious, and I don’t think they’ll want services like financial advice as much as when times were good.”

Another area of concern is the wider financial market, which many agree is likely to dip on Brexit – especially if negotiations fail – and the impact this will have on client portfolios.

Facts & Figures director Simon Webster says: “Brexit is one of the major concerns overhanging markets at the moment – if we crash out with no deal, a lot of markets will go south very fast while we work out what the hell is going on. It may recover, but it does cast a long shadow.”

Divorce settlement

As is clear from the above, most advisers would like to see a smooth and amicable divorce from the EU, with as much of the current arrangement maintained as possible.

More than half of those surveyed say they want the UK to stay in the single market, and that they support a transition period of at least two years.

Barrass says: “We must minimise disruption to business, otherwise clients will pay. We want a transition period as near to the status quo as possible. By staying in the single market and customs union, there will be no disruption to the way you handle investment funds.”

Despite this, though, a surprising number of advisers (47 per cent) believe that no deal is better than a bad deal.

Courtiers Asset Management chief investment officer Gary Reynolds puts this seeming contradiction down to a lack of foresight.

He says: “I don’t think a lot of people thought [Brexit] through in a lot of detail. A lot of people put out protest votes and didn’t think it was going to happen.”

However, on the no-deal scenario, Reynolds agrees, pointing to pro-Brexit economist Patrick Mimford, who argues that the EU is not a free trade area as you must be a member to qualify, and that the UK would benefit by leaving and then opening up tariff-free trade to the world.

Barrett adds: “What is so good about the single market? We’re talking about a bloc of 500 million people that includes a lot of nations that are not worth a jot to us in trade. Take those out and we’re talking maybe 300 million, and why is a bloc of 300 million people so much more important to us than China and India where you have 2.5 billion people? Or the US – which has 320 million alone?”

Perhaps unlike the majority of respondents to the survey, both Reynolds and Barrett underline a view that sees free trade with the EU as a red herring in both the pre- and post-referendum debate.

Brexit is one of the major concerns overhanging markets at the moment – if we crash out with no deal, a lot of markets will go south very fast while we work out what the hell is going on

Hardening of opinion

Instead, what may be at the heart of this contradiction in adviser views – that being a strong desire for free trade and single market membership while preferring a ‘no deal’ scenario – may be a hardening of opinion against the EU.

This is suggested by the nearly 60 per cent of survey respondents who state they believe the EU is being too inflexible in its approach – one of the strongest ‘agree’ answers overall.

Moreover, in terms of disapproval ratings, president of the EU commission Jean-Claude Juncker leads, with two thirds of those surveyed viewing Juncker more unfavourably than any other Brexit politician.

This attitude is further underlined by an increase in the number of advisers that would vote leave in a fresh referendum – up from 40 per cent in June 2016 to 42 per cent today.

On why one survey respondent would now vote leave, they say: “I only voted remain out of self-interest. I believe the response of the EU to Britain since perfectly illustrates why we should leave. I have no issues with each national government and their position. The unelected in Brussels, however, are a different matter. Obnoxious, parasitic, arrogant, self-serving and corrupt.”

Barrett is equally vehement: “Why should we lay down and let [the EU] walk all over us?”

Others, however, believe that current expectations of the EU are unrealistic.
Webster says: “Turkey’s don’t vote for Christmas. There is no way the EU was ever going to give us an easy ride out. Anyone that thinks the EU is going to give us a sweetheart deal because they love us and need our money is in cloud cuckoo land. There is too much political capital invested in the future of the EU for it to go any other way.”

Cockerill agrees, adding that too much emphasis has been placed on the importance of our market to the EU.

He says: “In the EU, political consensus is more important than trade. This is where we are falling down in negotiations.”

Moving forward

One area where advisers are united, however, is in their desire to see a more positive rhetoric from Westminster and businesses from here on. Combined with the 60 per cent who simply want the Government to get on with Brexit, an equal number of advisers believe it is the Government’s ‘duty’ to implement it. Now that it seems the UK is firmly heading for the door, it is time to talk up the opportunities.

Cockerill says: “I have not heard anything positive from the Government about the future – especially on our trading prospects with the rest of the world. We need that.”

As perhaps already indicated, an open and welcoming attitude to global trade is a hallmark of this debate. More than 60 per cent of advisers agree that the ability to sign trade deals with non-EU countries is ‘very important’ now – the strongest affirmative answer overall.

Regulation is another area of aspiration, as highlighted by numerous survey respondents.

One person who responded to the survey says: “The possibility of lighter, certainly less onerous, regulation in financial services is the biggest opportunity.”

Another adds: “We could have the freedom to reduce regulation and become more productive.”

Unlike Cockerill, others also believe that the market upheaval potentially caused by Brexit could create advice opportunities, with caution driving clients towards professionals, while others merely look forward to the stock picking opportunities in such a market.

Overall, the mood might be described as plucky resignation. Reynolds says: “Like the raft of regulation we advisers have to deal with now, if you take the view that this [Brexit] will create opportunities – which it will – and go in with a positive mindset, I suspect it will work out well for the UK.”

Thus, it would seem that, despite fears over how Brexit might impact businesses and clients, the UK’s financial advisers are ready for the country to start extricating itself from the EU.

As ever, clarity and certainty are desirable – as are current arrangements around trade, and a grace period in which Britain’s economy, legal and financial systems can adjust to their newfound independence. As some have argued, this may be a little too wishful. Regardless, though, the message is clear: keep calm, and Brexit on.

The post For better or worse? What advisers really think about Brexit appeared first on Money Marketing.

New Mifid II regulations will help the FCA clamp down on insider dealing and market abuse, MPs were told yesterday.

Responding to a question from Treasury Select Committee chair Nicky Morgan, FCA chief executive Andrew Bailey said: “We agree that [insider dealing] is something that has to have more attention. But thanks to better tools our ability to see the picture has improved.”

He said the regulator now got 30 million trade reports a day, which was helping them pinpoint irregularities in dealing patterns.

Morgan’s question followed a recent freedom of information request from The Times which found that the FCA has prosecuted just eight cases of insider trading in the past five years and secured 12 convictions.

The newspaper analysed share price movements on the day before major profit warnings, mergers or acquisitions over the last two years. In almost seven out of 10 cases, share prices fell the day before a profit warning, or rose prior to an M&A announcement.

Bailey said these findings did not come as “any surprise to us”. He adds: “The FCA is already in the process of recognising the scale of this problem.”

Bailey says the regulator has seen an increase in market abuse questions, but he doesn’t think that this necessarily means the problem has become more widespread. He said this is a function of having better data to identify issues.

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An increase in UK death statistics is concerning for longevity models, so relied upon in the pensions industry

A pessimist sees the difficulty in every opportunity; an optimist sees the opportunity in every difficulty. Put me down as a pessimist. And yet, when it comes to the implications of increasing life expectancy, I fear my brethren are guilty of the glass-half-full perspective.

Sure, for advisers working with clients, life expectancy is a literally unpredictable element that complicates investing for or in retirement. The duration of necessary cashflows is unknown because life expectancy is unknown. Since longevity insurance is unpopular with clients, averages provide a rule of thumb but no more for advisers constructing life plans.

Yet, for DB schemes and the government, the cost of meeting their pension promises depends, among other things – investment returns, inflation, regulation – on how long members live.

What new longevity measures mean for retirement advice

Longevity is a critical variable in discounting the present value of future cashflows. Indeed, a one-year difference in life expectancy today would have five times the effect on a pension scheme’s liabilities than it did in 1990 due to the impact of lower for longer interest rates, according to Club Vita.

Nonetheless, our professional lives risk blinding us to the public good. Public Health England’s recently published Health Profile for England reminds us how lucky we are, as well as highlighting new challenges.

In 1841, when the UK’s first actuarial life table was published, the average newborn girl was not expected to see her 43rd birthday. A newborn girl today can expect to live past her 83rd birthday. Baby boys’ life expectancy over the same period has risen from just 40 to 79 .

More time on this planet doing things that give us pleasure (and pain) – it is hard to think of anything more profound. Life is precious and the most basic measure of a society’s progress is its success in extending it. The gains of rising life expectancy are, in this sense, priceless.

So I was disturbed by the Office for National Statistics’ (ONS) provisional death data for the week ending 12 January 2018, which cite 15,050 deaths against the normal recent level of 13,170 for the second week in January. That is 1,900 extra deaths – 14 per cent up on normal.

Gregg McClymont: Getting inside clients’ heads

Nor is this a one-week blip. The same figures for the middle two weeks of December projected more than 2,000 extra deaths compared with the normal trend (an average of the five years 2011-2015). As the UK population ages and grows, one expects the annual death numbers to rise – but not at this rate.

Death rates in 2017 were around 5 per cent above the recent average. Indeed, life expectancy at birth has flatlined since 2011.

As Professor Danny Dorling puts it, “For the first time in well over a century the health of people in England and Wales as measured by the most basic feature – life – has stopped improving.”

Life expectancy for a woman in the UK is now lower than in more than half the countries of the European Union – the wealthier nations with which the UK would like to compare itself such as France, Germany, Italy, but also Greece, Portugal and Spain. Life expectancy rose by a whole year in Japan, already the nation with the longest, in the same period in which it flatlined in the UK, 2011-15.

The impact of these past five years of higher than expected death rates on future projections is dramatic. The ONS now estimates that, by 2041, life expectancy at birth for women will be 86.2 and for men 83.4. Both figures are almost a whole year lower than projected in 2014.

So what has happened?

Flu epidemics are often cited as being worse than in previous periods, whether because of mutations in the virus or greater gaps in health and social care provision, as budgets have been reduced in the austerity years.

The initial spike in mortalities was among older women living alone, a group disproportionately reliant on such services as social care home visits, and the availability and quality of nursing homes.

A change in modelling technique might also be relevant. In reaction to a history of actuarial science underestimating future life expectancy rises, the ONS has moved to a dynamic projection that is more sensitive to recent data.

If the flatlining in life expectancy rises turns out just to be a five-year blip rather than a long-term trend, the model will eventually recalibrate. In what are very long-term projections, statistical blips are, of course, eminently plausible.

But, in all honesty, no-one knows for sure.

What we do know is that the ONS is still projecting that life expectancy will continue to rise across the next 25 years. This is a good thing. Even when people living longer gives advisers, governments and pension schemes a headache.

Gregg McClymont is head of retirement at Aberdeen Standard Investments

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In the public’s imagination, the stereotypical adviser is, lamentably, a middle-aged, middle-class white man running a traditional business. That traditional business, Joe Public would assert, probably comes with a traditional world-view when it comes to issues like immigration, sovereignty and European “bureaucracy”.

The results of a Money Marketing research project canvassing adviser views on Brexit suggest the picture is a little more nuanced in the modern advice profession, however. In what we believe to be the most extensive polling on the subject, nearly 400 advisers gave us their views on everything from the political implications of Brexit to border control and law-making.

Stereotypes are borne out to some extent. On the one hand, most of our sample – 86 per cent of which was male, mirroring FCA data on the advice market – leans Conservative and thinks that the Government just needs to get on with Brexit. They rate David Davis and Boris Johnson much more favourably than Emmanuel Macron or Jean-Claude Juncker, who scores almost comically badly with a 10 per cent approval rating.

For better or worse? What advisers really think about Brexit

But nearly 60 per cent still voted to remain on EU referendum day, and would do so again if another referendum was held tomorrow. Nearly half agreed that remain voters’ views were being ignored.

The principal reason for a qualified remain vote seems to boil down to the modernisation of the profession: advice firms have had to become smarter businesses and adapt to the changing regulatory and economic environment. They don’t want these to shift again.

They believe having free trade with the EU and protecting EU citizens’ rights is far more important than controlling borders or ensuring the primacy of UK courts. The majority support a transition period to mitigate the worst effects of a cliff edge, and many advisers I speak to are concerned about the implications of passporting on ex-pat clients.

Advisers are understandably worried about what a “no deal” might look like for their businesses, and the handling of negotiations up to now has failed to inspire many with confidence – advisers have so far given the impact of Brexit on their job role and company a net negative score, which goes considerably further into negative territory on a “no deal” outcome.

However, a good deal – or at least the one that the Government wants – and advisers will be pretty pleased, saying it would be rated positively. As ever, no two advice firms are alike, and the plurality of views on Brexit we have uncovered illustrates that each will have different pushes and pulls on their business from leaving the EU. But, as with most other major events, the advice profession is well placed to weather the Brexit storm.

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The financial services industry does not suffer from a lack of trust. If anything, it has enjoyed a surfeit of it. Almost every scandal involves someone handing over money they could not afford to lose into the hands of someone they trust – be it an individual or a large corporate.

A mis-selling scandal the size of the PPI disaster could not have happened without a significant amount of trust in the financial institutions selling it, often by telephone, and the highly-regarded, highly-paid people running these institutions.

It has been described regularly as the biggest financial mis-selling scandal in history, and there have been a few. In remediation costs alone it dwarfs all others.
PPI claims paid out around £28.5bn in remediation from 2012 to mid-2017, with more to come. Indeed, the total amount set aside for such claims is £43.5bn – four and a half times the cost of the London Olympics.

Research by CCP Research Foundation on the five-year period to 2016 shows that this is a global trend, with £264bn in compensation paid out by banks over that time.

RBS and Lloyds Group feature in the top five, with £21.5bn and £20.5bn paid out respectively, although not all of that was for PPI. RBS set aside up to £5.9bn for a forthcoming penalty from the US Department of Justice for the mis-sale of toxic bonds in the run-up to the financial crisis.

In comparison, the last pensions mis-selling scandal, which followed on from new government policy on personal pensions in the early 1990s, chipped in with just £600m in compensation, mostly paid out from 2000 to 2002. It only makes eighth on the list of banking scandals compiled by Dominic Lindley/New City Agenda.

The list also includes Libor fixing, unauthorised overdraft charges, endowment mis-selling and so on. Yet the numbers show we keep going back to banks for more.

And scandal is not the sole preserve of big banks. Pension scammers are individuals or very small businesses, and while their reach is smaller, the damage they can do is arguably far greater.

Classic pensions scam

The recent “truffle tree” scam hit 245 people for an average of £55,000 each, totalling £13.7m, via 11 schemes run by four people.

The sales process was that of a classic pensions scam. A cold call with a promise of better returns for less risk by investing in an asset that did not exist. The stories told by the victims (and we have heard them many times before) provoke both sympathy and the banging of one’s head on the nearest table.

Regulated advisers benefit from this as well. There is no big brand behind an adviser, but face-to-face conversation builds rapport and trust quickly. Well-seasoned advisers regularly report to me a 90 per cent-plus conversion rate from face-to-face meetings and there is no shortage of training available to sharpen the sales axe where necessary.

Amid the speculation about a new defined benefit pension mis-selling scandal developing, revelations about regulated advisers making a quick buck through high-volume DB transfer advice are coming through thick and fast. There is evidence of very poor, highly-conflicted advice given out to people about their most valuable financial asset.

We are quick to label professional sports personalities and musicians greedy when stung by an ill-considered Ucis or embezzled by a dodgy accountant, because of the perception that they are high-risk speculators with more money than sense, but many are bankrupt because of poor, often borderline criminal, professional advice.

As every employee tips more money into their pension each month without thinking, it is worth remembering that pension funds have been regularly picked out as the worst and most opaque funds in an industry with its head down waiting for Mifid II disclosure headlines to go.

The three biggest pension consultancies have recently been reported by the FCA to the Competition and Markets Authority for their part in the problem.

What about the research? All papers, including academic ones, say financial services suffer from a lack of trust. Yet advisers have never had so many clients and all other parts of the industry are booming. What is driving more and more people into the arms of individuals and businesses they purportedly do not trust?

Perhaps trust is a problem but it only appears to be so with hindsight, long after the horse has bolted. I have seen plenty of survey responses from highly satisfied customers of businesses who have been quietly ripping them off for years.

Ignorance is a blissfully satisfied customer. Trust is an emotion – not a fact – and we frequently conflate it with customer satisfaction. When you look at behaviour rather than survey responses, it suggests to me the problem is not consumer trust but industry ethics. A new perspective is required.

Phil Young is managing director of Zero Support

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