The Sandler Review of medium and long-term retail savings published its final report today. It sets out proposals for a set of simple savings products accessible to the mass market.
Ron Sandler said: "It is of fundamental, and growing, public importance that Britain should have a savings industry that is both efficient and widely trusted. The long-term welfare of millions of people depends on it, as does the effective operation of our capital markets.
"The industry has achieved considerable success in many respects. But there are also grounds for concern.
"The Review has identified formidable challenges. But it has also sought to propose a clear agenda for government, for the FSA and for the industry. These changes will take time to implement, but they offer a robust basis for the long-term future of the savings industry - one in which effective competitive forces can be made to work for the benefit of consumers, the wider economy and ultimately, the industry itself.
"The clear conclusion of the Review is that simplification of products and advice is the key to delivering effective competition and to empowering the consumer. Stripping out substantial elements of cost will enable lower income consumers to access savings products more easily."
The Review's recommendations for the FSA and the government include:
· The introduction of a suite of simple regulated products, with capped charges, restrictions on investment profile and the ability to exit on reasonable terms.
· A clearer and simpler structure for with-profits products.
· A new model for independent advice.
· Tax simplification measures.
· Measures to boost consumer education in financial matters.
· More stringent investment qualifications for financial advisers.
· A set of principles for retail savings products based on the Myners principles of investment.
Sandler added: "The Review alone cannot hope to remedy all the problems highlighted. It strongly supports the continuing efforts of the industry, the government and the FSA to make improvements."
