Crucial changes to the way in which financial advice is given and products sold should be delayed for another year, says the Treasury Select Committee.
The Financial Services Authority had said that it wanted commission payments to be outlawed from the financial sales process by the end of next year as well as advisers to have to sit more rigorous qualifications. The paying of commissions to advisers by product providers has been linked to many of the worst mis-selling scandals in the UK over the past two decades.
But, on reviewing the proposed changes MPs on the select committee have asked for a delay of 12 months to allow advisers more time to take necessary qualifications.
But in response the Financial Services Consumer Panel – which advises the FSA – has said that any delay would be detrimental to consumers: "There can be no justification for the FSA to back away from this important requirement. MPs would be rightly outraged if their constituents were treated by doctors with A-level qualifications or advised by poorly qualified lawyers.
"Further delay will only risk harm to consumers as the effects of poor financial advice can last a lifetime," Kay Blair, the vice-chair of the panel, said.
The FSA said it is still committed to its current timetable.Reuse content