The Financial Services Compensation Scheme is not fit for purpose.
It is a lifeboat so full of holes that no matter how much the government and the Financial Conduct Authority seek to patch it up with meaningless reviews, it will never be state-of-the-art.
It should be left to sink and a new, sleek replacement built to take its place.
For a start, it is ridiculous the FSCS, which does its level best to pay out to consumers the redress they deserve, cannot have any real say over how it raises the money for this.
Its levies are set by the FCA, and not on any basis that makes sense.
We're all familiar with the 'polluter pays' model, but the polluter rarely pays in the case of phoenixing or its harder-to-discern brother, resurfacing.
Firms can go so bankrupt through deliberate fraud or mismanagement they cannot afford to pay the consumers they have, to all intents and purposes, robbed.
So the industry pays – and each year, pays more and more.
Moreover there's no product regulation.
This is understandable on the one hand, as the regulator does not want to stifle innovation.
But in the case of untested, potentially complicated products, the regulator should be stepping in at the point of launch and either preventing a problem from occurring, or agreeing to bear the penalty itself if the product goes wrong.
But instead the FSCS will end up, somewhere down the line, coughing up other people's money to pay out as a result of poor products being allowed onto the market and resulting in poor consumer outcomes.
And what of the FSCS's power to prevent, rather than cure?
Well it is making great strides to help educate consumers and make them aware of schemes and scams, which is to be applauded.
But no matter how much the lifeboat owners may want to have a dialogue with the industry and may want to have a restructure that gives them more powers or reduces the need for such high levy increases on the industry, they cannot. It is just not set up that way.
Try as it might to row across the dodgy waters, the FSCS, as it is currently positioned, cannot be sustained. Let it sink.