The debate by MPs took place following a proposed amendment to the Financial Services and Markets Bill calling on the Government to introduce a personalised guidance regime.

Following support from MPs, the FCA and Treasury officials are now expected to advance proposals for a new regime before the end of 2024.

Personalised financial guidance will allow simpler, tailored guidance on straightforward investment products such as ISAs which may not need holistic and comprehensive, but expensive, full Financial Planning advice. The aim is to give  investors unable to afford Financial Planning some help with choosing investments and to discourage them from leaving large sums only in cash.

The proposed amendment was brought forward by Harriett Baldwin, chair of the Treasury Select Committee.

Ms Baldwin stressed the need to address the advice gap, saying that it, “cannot be right that only the wealthiest can access financial advice.”

She said that only 8% of people are currently able to access financial advice and that the Government should use the new flexibilities from being outside of the EU to conduct a personalised guidance review with great urgency.

Despite calling for an amendment to the Bill, Ms Baldwin added that the amendment itself is not necessary as the Government is able to move to introduce a personalised guidance regime without needing to change the legislation.

Chris Hill, CEO of Hargreaves Lansdown, welcomed the move towards a personalised guidance regime.

He said last week: “Yesterday marked a significant milestone in the campaign for a regulatory regime for personalised guidance.  Following a debate in the House of Commons there has been a clear demonstration of political support for this regime from right across the House. 

“This steer, as well as the strong support from the minister – makes it clear to the FCA and Treasury officials that they need to advance this proposal before the next election (which needs to take place by the end of 2024).”

Prakash Chandramohan, strategic policy director at The Investing and Saving Alliance, added: “During a time of highly polarised politics, it is great to see agreement reached across political parties that more engaging, personalised guidance and support is needed to help people with their financial decision making. 

“The tough years ahead cannot be wasted. The time will come when this crisis is over, so the necessary foundations need to be in place to support everyone in rebuilding their financial resilience.”

Supporters for the amendment within the House of Commons included Labour chair of the Work and Pensions Select Committee Stephen Timms, former Shadow Chancellor John McDonnell, member of the Treasury Select Committee John Baron and member of the Treasury Select Committee Anthony Browne.