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9 July 2002

AITC WELCOMES SANDLER REPORT AS A BIG STEP FORWARD FOR CONSUMERS

Today the Association of Investment Trust Companies (AITC) warmly welcomed the Sandler Report.

Daniel Godfrey, Director General of the AITC said: "The Sandler Report is a big step forward for consumers. The financial services industry needs a radical shake up as the present competitive dynamic is geared towards rewarding the distribution of products at the expense of consumers. If this is reversed, with the proposals on simplified products and adviser commission, the playing field will be levelled for products that offer consumers advantages such as investment trusts."

Investment trusts' benefits can include: low charges, strong long-term performance, and low entry fees. They also have independent boards of directors whose sole purpose is to maximise value for shareholders.

Daniel Godfrey continued: "The AITC is particularly pleased that the Sandler Report has recognised the unfairness of the VAT treatment of investment trusts in comparison to other mutual funds. We are looking forward to working with the relevant Government departments to bring this to a conclusion as soon as possible.

"The AITC, as a major sponsor of financial education, is delighted to see the Report's emphasis on this area. The Government, Financial Services Authority and industry must now recognise that if they will the ends, they must also will the means and find the money to educate consumers about financial matters."

Association of Investment Trust Companies (AITC)