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Aifa has welcomed changes to the Financial Services Compensation Scheme, which should lead to a significant reduction in fees for most member IFAs.

Chris Cummings, director general of Aifa, said he was pleased the FSCS had listened to calls for reform and hailed it as a positive step. He said: "At its peak the FSCS industry levy for IFAs totalled £47.5m, this year the bill will be significantly reduced. We are pleased with the outcome of our lobbying as it will create a fairer distribution of costs across all parts of the financial services industry."

Last year, firms in fee-block A13, where most IFAs fall, paid about £1290 to each adviser to meet FSCS costs. Under the new structure, a firm's levy will be based on the amount of income generated from the different classes of business untaken, not the number of approved persons.