Independent broker group Brokerbility is lobbying the government and MPs as its begins a campaign against mandatory commission disclosure.
The group, consisting of 22 independent brokers around the country, is urging more brokers to join its fight against hard disclosure and is building up a ‘fighting fund’ to support its campaign.
It has appointed a consultancy group to act as parliamentary lobbyist and has met with MPs and officials from the Treasury and the Department for Business Enterprise and Regulatory Reform.
Last week the FSA said it would not mandate commission disclosure at the present time, but warned it might do so in the future following further work in the new year.
Stuart Randall, director of Brokerbility, said: “Brokerbility decided that not enough was being done to protect the independent provincial broker and that there was substantial pressure from many parties with vested interests in hard disclosure.
“The FSA will be under intense and sustained pressure from others in the industry who want to see hard disclosure introduced, and that pressure must be matched from our side. We need to continue to lobby and fight our cause.”
He said that for brokers’ income to fall 29% to 36% to cover the costs of hard disclosure, as the FSA’s study predicted, would be “catastrophic”. They have also pointed out to MPs that any measure which forces faster consolidation due to falling income would reduce competition, and lead to increased prices for consumers.
Philip Dunne, Conservative MP and member on the Treasury Select Committee, said he had sympathy for smaller brokers.
He said: “If the FSA were minded to set a compulsory mandated regulation then it is something that I would press the Treasury chairman to consider.”
Shadow Treasury Minister Mark Hoban, said: “I wrote to FSA chief executive, Hectors Sants last week to ask if he could make sure that the small brokers were represented on this during the consultation process.
“It is right that smaller brokers should have their voice heard and there should be a proper debate about it.”
The group is set to meet with the FSA early next year. The FSA refused to comment on the campaign.