50 in 2020
CPD is in the news, as I am sure you are well aware.
CP19/25 is a seminal paper. It will have implications far beyond the immediate defined benefit pension transfers (DB TV) taking place: far, far beyond and for years to come.
If you haven’t read CP19/25 I’d suggest you start reading it now:
https://www.fca.org.uk/publication/consultation/cp19-25.pdf
‘’We consider that our proposals requiring advisers to undertake mandatory CPD will increase their knowledge. This should improve the quality of the advice they give consumers….’’
The FCA is a tad concerned about the current DB TV market (as I am sure you are aware..) – and not just concerns about the ongoing competence of Pension Transfer Specialists (PTS):
‘’The competence of a PTS is one of the potential drivers of unsuitable advice. We want to ensure that skill levels are high and are maintained over time…’’
But, yes, they do have concerns about YOUR competence.
It is no longer appropriate to have the 1974 Insurance Society Occupation pension exam qualification, or indeed a G60 from 1996, without evidence of professional development since then..
And the FCA is proposing some very specific and detailed guidance:
‘’We are proposing that PTSs must undertake a minimum of 15 hours CPD each year, focused specifically on pension transfer advice…’’
In line with the ‘’seminal’’ approach and very direct nature of the guidance, that is a significant move by the FCA.
And they go further:
‘’This would be in addition to any other existing CPD requirements for other types of advice’’
So, this is in addition to your regulatory requirement of 35 hrs?
As a PTS you now need 50hrs CPD?
Is that going to be the case in 2020?
And they don’t stop there:
‘’Further, at least 5 hours of the 15 hours must be provided by resources external to any firm that employs or contracts services from the PTS”.
This will ensure that a PTS is not just receiving a ‘house view’ of the market. We believe that this is a proportionate way to address any skills shortfall or out-of-date knowledge that might exist…’’
I can assure you that this is going to take place. This is no ‘normal’ consultation.
This is as direct an instruction from the FCA as I have ever read in 25 years. You will need a plan – and like most of the key elements of CP19/25, they will be enabled by the FCA very quickly (in relative terms).
This is an advance notification of changes – they are coming..and quickly:
‘’We propose that the new requirements would come into force at the beginning of the calendar year after our Board makes the final instrument….’’
Here is my take:
Consultation ends 30 October
Board meeting before Christmas
Resolutions accepted and implemented
Calendar year for new CPD arrangements starts 1 Jan 2020
That’s my take on the timing: this is going to start on 1 Jan 2020. Yep – that’s less than 4 months away (albeit, you’ll have 12 months to complete it..).
What is it going to look like?
Well the FCA have already indicated what it might look like:
‘’… we assume total course costs of £500 per day over two days which totals £1,000 per individual…..’’
That’s the FCA figures. That’s the FCA estimated costs – and they normally get them wrong: they normally under-estimate the costs.
We’ll be in touch soon to explain what we’ll be offering individual PTS, IFA firms and large corporate networks to support this requirement.
We are the UK’s foremost expert pensions training firm and we have been delivering expert pensions workshops and online training for 10 years. Over the years we have trained, mentored and enabled 1000’s of advisers achieve PTS status and we want to ensure that you have everything you need to satisfy the new PTS CPD requirements for 2020.
Right now, we are working on what YOUR new PTS CPD for 2020 looks like – Watch this space – we’ll be telling you more….soon!
Bibliography:
https://www.fca.org.uk/publications/consultation-papers/cp19-25-pension-transfer-advice
