Money Guidance is a Good Idea in Principle …

Andrew Porter, Managing Director of The Financial Services Forum, takes a look at the Thoresen Review, and asks, “…is that it?”
The Financial Services Act of 1986 was supposed to sort out the financial services industry and the provision (and acceptance) of good advice, but the two decades since seem to have been characterized by a constant struggle between the increasing complexity of protective legislation and the need for simplicity to rebuild the trust, confidence and participation of the ordinary citizen. There have been many further reviews, and changes, and more reviews. The latest is the Thoresen report, led by the chief executive of Aegon in the UK, charged with examining the provision of general financial advice.
Otto consulted widely amongst interested parties, and part of this process involved a group of senior Financial Services Forum marketers who reviewed the issues and then contributed to a workshop at the Treasury in January. Andrew Porter, chief executive of the Forum, summarizes the published conclusions and recommendations of the review, but also wonders whether it goes far enough.
For the clear view of Forum members was that the real challenge will be the creation of an effective engagement strategy to overcome the consumer’s general reticence towards money management and longer-term financial provision. Whether this is a matter of simple inertia, or a preference to spend the money on something more immediately satisfying, or a deeper distrust of the industry, Thoresen effectively leaves this issue unaddressed – hopefully, but not necessarily, for another day.
Using the contributions produced by the Forum group, Andrew puts the case for further action now: effective generic advertising, perhaps along the lines of the successful five-a-day campaign; leveraging existing trusted advisers (not necessarily industry professionals); sponsorship; celebrity endorsement; even better industry training; and the crucial role of employers, in terms of both endorsement and efficient delivery of the benefits.
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