Firms authorised by the UK’s Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA) will have to collectively pay £363m ($518m, €475m) to fund the Financial Services Compensation Scheme (FSCS) in 2016/17, an increase of 13.1% from £319m in 2015/16.
Levies set by the UK’s Financial Services Compensation Scheme (FSCS) hit an all-time high in 2015, with many firms concerned that they have reached unsustainable levels, according to APFA.
The Financial Services Compensation Scheme paid out £327m in compensation to British consumers over 2014/15, a significant rise from the previous year after payments for SIPP-related claims made against financial advisers soared by 50%.
UK-based life and pensions advisers are going to be hit with an annual levy that will almost double what was forecast in the Financial Services Compensation Scheme’s plan and budget.
The Financial Ombudsman Service has frozen its compulsory levy which is partially funded by advisers and will cut its budget by 11% over the next tax year.
UK pensions advisers have been hit with a potential increase of £24m in their levy to the Financial Services Compensation Scheme (FSCS) for the next financial year.
The Financial Conduct Authority (FCA) has proposed giving advisers a 50% reduction in the levy to fund the Government’s guidance guarantee service.
