22nd April 2010

Have you seen the RDR Cost Benefit Analysis reports?

It would appear that many IFAs have not actually had sight of the CBA - Cost Benefit Analysis report prepared for the FSA in regard to the RDR.

In light of this, you may wish to study this in detail and consider whether the numbers look relevant to you. For example, Deloitte's, in submissions to the FSA in their 2009 CBA - cost/ benefit analysis, estimated that "the incremental cost for each adviser to reach QCF Level 4 is approximately �£2,600, taking into account the cost of exams, materials and paid leave and this does include the cost of new membership of professional bodies where one would expect this to be taken out as part of the process to achieve Level 4".

Does this seem realistic as "study time" reduces "advising time", I wonder what the actual cost to IFAs is so far?

The links to the reports are split into two categories. One relates to the Consultation Paper (CP) and the other to the Policy Statement (PS):

Click on the links below to view:

RDR CP - 2009

Estimation of Total Incremental Compliance Costs for RDR Proposals

Oxera Report: Retail Distribution Review proposals: Impact on market structure and competition

Deloitte report: Firm behaviour and incremental compliance costs

And

RDR PS -2010

PS10/6: (See Chapter 6 and Annex 1 for a summary of the revised CBA) issued March 2010.

FSA estimate of incremental compliance costs for Retail Distribution Review

Oxera report - Retail Distribution Review proposals - Impact on market structure and competition

Please provide any feedback to these via our forum; it will be good to collate some views, even if the horse may appear to have bolted for the time being.

Many thanks to Alan Lakey for his continuing quest to shed light where there is dark. AdviserAlliance

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