Advisers across the investment and life and pension intermediation sub-classes are facing a combined Financial Services Compensation Scheme levy of £182m for the year ahead, 25 per cent more than this financial year despite predictions investment claims in particular will fall sharply.
According to the full proposed plan and budget, which has been published for consultation following an earlier statement outlining headline figures this morning (20 January), investment intermediaries are to be hit with a levy of £125m this year.
This is more than the £112m that was levied for the 2014/2015 financial year, despite FSCS predicting complaints in this area will reduce by almost half next year from 10,325 to 5,353.
FSCS noted claims against Catalyst and Arch Cru appear to be coming to an end, but that other types of investment claims will continue in steady volumes.
In the life and pensions intermediation sub-class, the levy has been set at £57m, up from £33m, ahead of an expected and previously cited increase in claims over self-invested personal pensions advice.
Levies in all other areas are expected to fall, while for general insurance intermediation the claim is expected to be zero having been £38m this year.
The compensation scheme today revealed it expects a reduction in the overall volumes of new claims in 2015 to 2016 to 25,590 compared with 28,108 in 2014 to 2015.
In total, the figure for 2015/2016’s levy stands at £287m, with deposits, general insurance and base costs added in. This compares with 2014/15’s figure of £276m, equating to an overall increase of £11m.
As was previously disclosed, the FSCS has said it expects recovery costs, including those relating to the court cases against advisers over Keydata, to fall to £10.8m in 2015/16 from the current £15.1m.
ruth.gillbe@ft.com, ashley.wassall@ft.com
