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How much money has been spent on RDR, I wonder?
When you add together the budget of the FSA, the money we advisers have had to pay the CII and others, and the man hours that can’t be charged to clients, I suspect the total bill will be many multi millions.
Now, don’t get me wrong, I am a fan of compliance, in general terms. I’m old enough to know people who remember when building society managers would sell endowments and get paid commission on the side, total non regulation. But the pendulum has been swinging only one way for a long time now.
So what do clients think of RDR and all the changes? They, after all, are the ones that regulation is trying to protect.
We sent out an email to all our clients. We do this every year to announce changes in fees, and issue a new terms of business.
This year, driven by RDR, we had to send out a lengthy covering email to explain a few things. Our client agreement has changed completely, a new keyfacts document, an explanation of how deregistering for VAT will affect clients, and so on. This was the big test, what would clients make of it all, what questions might they have. How would they react to all these changes that have cost so much time, energy and money.
We’ve had 3 responses so far. One said “Fair enough.” One asked us to go and see the client to agree fees for the coming year, which I see as a good thing to do.
But my favourite response was from a long standing client, and friend, who took the time and trouble to email me. He sent just one word:
“Whatever.”
Now, I’d like to think that we’ve had so little response from clients because we’ve always worked in line with RDR principles. Maybe RDR wasn’t really aimed at firms like ours. And yet it still affected us, and our clients, enormously, if not just because of the fees we have to charge the client in order to pass that money over to the regulator, ombudsman and compensation schemes.
As some clever French dude once said: The more things change, the more it stays the same.