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Niko Kloeten
Niko Kloeten
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[Weekly wrap] Bad news for QROPS providers

Friday 23rd of March 2012

The changes to the QROPS scheme have been on the cards for a while, but despite lobbying by New Zealand's financial industry, the changes are set to go through almost unchanged.

This will cause disruption for QROPS providers, who may have to shut down their schemes and relaunch new ones. And, according to QROPS adviser David Milner, will slow down the flow of UK pension transfers while those at the other end try to work out who is compliant and who isn't. 

The reforms hit the whole industry (with the exception of KiwiSaver, which is exempt) rather than targeting the specific providers whose conduct led to New Zealand being singled out in the reforms.  Those who behaved themselves may well feel hard done by.

Another issue that can cause temperatures to rise is that of online insurance.  Online life insurance has proved controversial among advisers, and now New Zealand's first online income protection insurance has met with a similar reception.

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All things said are great aspirational goals for a great financial advice industry, it mirrors what both the legislation and the code requires. However, like most things discussed it talks about what's expected not how it's done. The hardest aspect of financial advice today isn't what it is, it is how it is done. The how only comes from those that have done it, the how is only provided with examples. Guidance documents that spell out what's required along side how it it done. We’re still dealing with the same issues we started with in 2021, figuring out the how. And figuring out the how in every advice business is consuming resources that could easily be shortcut by the FMA demonstrating what they are expecting. It's not about “do it this way” its about this is the sorts of things we’re looking for. In the absence of standards and expectations, guesswork prevails. That represents significant risk to FAPs and the result is onerous overcooked advice processes for multiple advice operations and undercooked she’ll be right for single operators focused on getting the work done. Both approaches have potential for harm and as its been said earlier, leaves advisers open to explain they haven't been speeding with the authorities have pulled them over. The advice industry needs guidance on the how we know the what already.
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Who is responsible for notifying policy changes?
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To correct errors in my previous post: "policies, templates, and controls" should read "policies, processes, systems and controls", and "is more conductive" should read "is more conducive".
2 days ago Paul Flood
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2 days ago agressively passive