8th March 2022

Confused, you will be if not already.

Pension providers have called on MPs to change advice rules to allow them to offer more personalised guidance. 

Now with the aid of some definitions, I think we can see exactly what the issues are.

Guidance is a noun, it is often defined as advice or information aimed at resolving a problem or difficulty, especially as given by someone in authority. Something that is referenced very often by the FCA in communications. 

Advice is also a noun; it is often defined as guidance or recommendations offered with regard to prudent future action. Something that is referenced very often by the FCA in communications.

Conundrum is a noun too, it is often defined as a confusing and difficult problem or question. Strangely enough something that is very often created by the FCA but seldom referenced in communications.

Rules-based regulation is based on detailed rules that set out specific standards and requirements. This type of regulation is highly prescriptive, making clear what can and cannot be done.

Principles-based regulation means moving away from reliance on detailed, prescriptive rules and relying more on high-level, broadly stated rules or Principles to set the standards by which regulated firms must conduct business. 

Can somebody let me know, exactly, today, WTF is going on?

This is not really about the consumer, it is about who is responsbile if that advice or guidance did not work out as well as intended. It is also about what is the difference between guidance and advice, as we can see above, nothing at all.

As that great Ella Fitzgerald song goes:

“You like potato and I like potahto. You like tomato and I like tomahto. Potato, potahto. Tomato, tomahto”.

Let's call the whole thing off!

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