FAMR criticised for 'unrealistic' format

Only 20% of advisers responded to FAMR

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FAMR criticised for 'unrealistic' format

The Financial Advice Market Review (FAMR) has come under fire for being too difficult and time-consuming for advisers to respond, creating a danger the 'views on the ground' have not been heard.

Provider Zurich said the Financial Conduct Authority (FCA) and Treasury's joint project was "unrealistic" from the outset, as it would have taken an adviser "a week" to respond to the review.

The FCA recently released figures as part of a Freedom of Information request showing a mere 68 advisers had responded to FAMR, representing about 22% of the adviser population.

FAMR launched last August in an attempt to find ways to bridge the so-called 'advice gap' and broaden the reach of regulated advice.

Industry consultations supporting the review opened in October focusing on robo-advice and free guidance provision, and closed on 22 December.

In November, city minister Harriett Baldwin urged advisers to respond to the input call, saying it was important to get their views heard.

But Zurich head of regulatory developments Matt Connell said it was not surprising the majority of advisers avoided responding to the review given how time-consuming it was.

He said it took him and a colleague three days to respond to the work, which encompassed 40 "essay-style" questions resulting in a submission of about 8,000 words, while other organisations submitted even lengthier responses.

Connell warned the low adviser response meant some of the problems FAMR was set up to deal with will not have been answered by those who deal with them on the ground.

He said the problem was "there was an implication you had to respond to all questions", some of which seemed repetitive and some were very broad, for instance, asking for views on the nature of the market.

Connell said it was important to get a comprehensive picture but the review would have been better served taking the form of some of the FCA's recent works, combining a short questionnaire with a wider market data gathering exercise.

Connell said: "It was unrealistic to expect advisers to answer these questions. If they had taken a few questions and made clear you only had to respond to the ones that interest you that would have made it easier.

"One of the reasons why FAMR was set up was because of [the issue of] insistent clients. It's often the smaller high street advisers who are involved in the insistent client issue not necessarily the larger firms.

"There is a danger one of the [areas] FAMR was set up to address wasn't getting addressed."

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