The FSA's cost-benefit analysis of its menu proposals implies IFAs will be squeezed between falling commissions brought about by greater market transparency and rising compliance costs.
The latter have been pegged at nearly £40m just to introduce the menu system, with ongoing costs of £22m annually, split between providers, tied and independent advisers.
In contrast, the FSA does not provide a specific sum of benefits, instead stating they will flow through to consumers in the form of a "reduction in commissions" and reduced likelihood "that bad value products will be sold."
"The menu may increase consumer awareness of the cost of advice, and how it varies between products and providers, and across the market," the FSA says.
"Increasing consumer awareness of the cost of advice could encourage greater negotiation, which may lead to commissions and fees reflecting more closely the underlying costs of providing advice, improving the allocation of resources. This may also lead to increased rebating."
Falling profit margins are not the only challenge the menu will pose, the FSA points out.
"Firms might be less inclined to sell high commission products as this may make them appear less competitive. This could reduce the likelihood that bad value products will be sold."
The FSA does not explain why it necessarily sees a link between higher commissions and poor value products, or why cheaper products are necessarily better value.
The FSA will spend about half a million pounds on developing the menu, and some £44,000 annually calculating market average commission rates for use within the proposed commission tables.IFAonline
Scope for change post-Brexit
To tackle liquidity issues
More than £100m in pipeline
DB data published last week
'Heavily influenced by Morningstar'