The Financial Services Consumer Panel today welcomed the announcement by the FSA on how it plans to reform the way consumers can pay for their financial advice.

In its response to the FSA's recent consultation paper CP121, the Panel argued that consumers should be given a clear choice of paying their independent financial adviser either by commission or by fee.

The FSA's new menu proposal will require advisers to set out clearly the services which they provide, together with the options of paying by fee or commission, and a straightforward set of the costs charged, as well as comparative industry costs. This will have to be given to the consumer in the early stages of the sales process.

Colin Brown, Panel Chairman, said:
"This proposal gives consumers clear guidance and options on how they can pay for their financial advice. It is exactly in line with the Panel's own response to the FSA's consultation. It will be good news for consumers."

This is the first part of the FSA's conclusions from its recent consultation on overhauling the way in which financial advice is structured (known as 'polarisation'). The Panel looks forward to seeing the other results of the FSA's reform process in due course.

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Notes to editors