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Financial Services

Answer

The Government is committed to the principle that people who have worked hard and saved should have access to appropriate and accessible investment options and understand the charges that they face. We appreciate the efforts that industry have made to fulfil this aim.

Since last April, the Government has ensured that trustees of defined contribution pension schemes report charges levied on members in schemes used for auto enrolment.

We are also engaging with international work on transparency, such as the legislation agreed at European Union level through the Packaged Retail and Insurance Based Investment Products (PRIIPs) and Markets in Financial Instruments Directive (MiFID). MiFID II will introduce new measures to increase transparency of research costs for clients of portfolio managers. Under these new measures, portfolio managers may only pay for research through their own funds or from a specific research payment account funded by its clients and subject to specific controls, including a research budget.

The Financial Conduct Authority (FCA) is also currently conducting a market study into asset management, which covers the issue of whether the level of fund management fees charged to consumers reflects a competitive market. We await the FCA’s assessment of competition in this sector. The FCA expect to publish an interim report in summer 2016 and a final report in early 2017.

Secondary information

Type

Written question

Reference

HL8188

Session

2015-16

Grouped for answer

Yes

Subjects

Cost effectiveness Financial services

Link

View this Written question on www.parliament.uk