From the UK’s Daily Telegraph:
Martin Wheatley, director of the FSA: “We, as the regulator, intend to change this culture of viewing consumers simply as sales targets and I am going to be personally involved in getting this right.”
There was some concern voiced about the damage to the UK’s Financial Services industry, concerns which completely missed the point that more efficient lower cost retail financial services should release capital for reallocation to other parts of the economy and enhance future consumer financial security and help support expenditure.
Retail financial services is a high cost, labour intensive, industry providing, in recent modern times, ineffective financial outcomes for consumers.
Commission and commission based incentive structures are barriers to innovation that could ultimately reduce costs to a fraction of their current level.
The FSAs plans are firmly in the camp of being capital market and consumer friendly, but are not of course friendly to a bloated and inefficient financial services sector. I dare say that this is the future and in a low growth, low potential investment return environment, the industry has to deliver better value for money if it is to have a rationale for being.
I see little point in the impoverishment of the client base to fund the lifestyles of financial services employees: we have had overfishing for too long and we need to focus on sustainability and balance.