A decade is a long time in the worlds of politics and personal finance as was amply demonstrated yesterday when Andrea Rozario, chief executive of Safe Home Income Plans, the body the represents the equity release market, addressed the All Party Group.
SHIP was born out of the scandals in the equity release market that tarnished its reputation so badly in the late 1980s and early 1990s and has obviously done an extremely good job in turning round opinion. The last time the All Party Group tackled this subject was on the back of those scandals – concentrated around the mis-selling of a couple of Midlands building societies – and there were alot of extremely angry constituency MPs who wanted the market regulated out of existence. Eventually, some common sense prevailed and a compensation deal was brokered that gave the market breathing space to sort out the mess it was in. To its credit, it has made great strides in doing just that and has clearly won the confidence of politicians along the way.
Yesterday's meeting with SHIP was well-attended by the standards of all party group meetings and was attentive and positive, with MPs and peers of both main parties wanting to know what more they could do to help the market, especially in its difficult interface with the benefits system.
SHIP's introduction of a code of practice and requirements for training have clearly raised standards in the market, although I was disappointed that we didn't hear more about what happens when one of its members falls short of those standards: some figures on complaints and the processes for dealing with them would have been useful too beyond the referral of individual complaints to the FSA that its.. It was interesting to hear SHIP distancing itself from the emerging problems in the sale and rent back market which it clearly sees as having the potential to drag the whole equity release market back into the mire. It does offer some robust advice to consumers on this fraught topic, however, so it isn't sticking its head in the sand.
Ms Rozario was full of praise for politicians and regulators for understanding what the market had done to clean up its act but mildly critical of the media for not given it so much credit. The media is notoriously cynical about trade associations born out of market scandals, and rightly so given the track record of many, and it also has long memories. SHIP will have to be patient if it expects ringing endorsement on the personal finance pages as a decade is not always such a long time in the media.
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