The Financial Conduct Authority has pledged to work alongside PIMFA to help wealth managers and financial advisers to stabilise the Financial Services Compensation Scheme levy by 2025 and reduce the levy burden by 2030.
The regulator’s announcement came on the same day the FSCS lowered its forecast for the levy from an initial £1 billion in 2021/22 at the start of this year to £717 million.
Sarah Pritchard, executive director, markets at the FCA, said the regulator was looking to stabilize the FSCS levy by 2025 as part of its “transformation policy” and was targeting a year-on-year reduction in the levy between 2025 and 2030.
The FCA plans to publish a consultation paper before the end of the year, which will set out proposals on how the levy might be stabilised.
Liz Field, chief executive of PIMFA, said: “We welcome the announcement today from the FCA that the regulator wants to work with us to stabilize the FSCS levy and work towards real world year-on-year reduction in the levy between 2025 and 2030.
“PIMFA remains absolutely clear that the current levels of FSCS funding are unsustainable for the industry and can only be addressed once the drivers of FSCS claims are suitably addressed.”
