Targeted support could be a “turning point” for the financial advice industry in the UK, Aviva head of savings and retirement, Alistair McQueen, has said.

Speaking during a panel session on empowering customers to make good choices at the Association of British Insurers (ABI) Annual Conference this week (27 February) McQueen made the comments in response to the Financial Conduct Authority’s proposals in its Advice Guidance Boundary Review (AGBR) policy paper.

“I would go as far to say this discussion paper could be a turning point for the industry. If you look back over the past decade, what this industry has been all about is getting participation into our industry… but the page turn into the next decade is going to be about the adequacy of those savings and helping people take control of their money and that is what this paper specifically speaks to. So, we genuinely thank the FCA and the Treasury for being pretty brave and putting those ideas out there,” Mcqueen said.

However, for targeted support, which is one of the FCA’s proposals, to work he said the regulations need to be proportionate and the industry needs help from the Information Commissioners Office (ICO) to provide some regulation to “allow us to tell people that this support exists” and the Financial Ombudsman Service (FOS), as it will “judge how we behave as an industry regardless of what the rules and regulations say”.

“If we can all be open-minded to those changes and if we can all be quite brave then I think this could transform the life of millions of people in this country and let them take control of their money like never before.”

The Financial Conduct Authority’s AGBR policy paper closes today, 28 February, and its proposals, such as targeted support and simplified advice, have been largely welcomed by the industry.

McQueen said the policy paper is an example of the FCA and the Treasury “stepping forward” and “wanting to help.” Currently, just eight per cent of savers take financial advice in the UK and the panel spoke about the use of technology in bridging this gap but that human interaction remains essential.

M&G Wealth Advice CEO, Ross Linton, said technology can be a good “co-pilot” in how we deliver our solutions but “it cannot fully replicate the value of empathy, trust and some of those challenges that we face”. However, he added that financial advisers are “very interested and engaged” with the concept of technology.

“New solutions, simplified journeys and a better use of technology to enable that to work better should be seen as a big positive for us. I think advisers will embrace that but… you still need to focus on human interaction and empathy, if we’re going to build trust and close that advice gap,” Linton said.

McQueen said face-to-face interaction “cannot be bettered” but as only 8% of people are currently engaging with that “it is a massive bridge for the 92% to go from nothing to full financial advice; they are terrified of that step. Therefore, these reforms can act as a positive bridge.”

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