The Financial Services Compensation Scheme has paid out more than £36.5m in compensation to British Steel Pension Scheme members.
The FSCS told FTAdviser it had paid out this compensation to members as of January 25.
Meanwhile, in a letter to MP Nick Smith, the FSCS said it has received 1,263 claims in total, of which it has upheld 638.
Dated to February 8, the letter said 74 claims had not been upheld and it was yet to issue decisions on 551 claims.
Last year the lifeboat scheme completed 543 cases, with 490 receiving compensation.
In 2019, this was 84 claims, with 73 receiving compensation, and in 2020, this was 36 and 25 with compensation.
Based on the current data, the FSCS said the uphold rate is 90 per cent.
But the average length of time taken to resolve a complaint is currently 111 days.
In response to Smith, Caroline Rainbird, chief executive of the FSCS, said it was important to note the time taken to process a claim often depended on third-parties providing details to the FSCS – including the administrators of the failed firm or other parties holding customer information, as well as from those firms acting on behalf of customers.
“This can slow the process down as third-parties might not respond in a timely manner or it might take time to track down who is responsible for providing the information in the first place,” she said. “This means that we sometimes cannot turn around the claim as quickly as we are otherwise able to do.”
Rainbird said there are currently four firms expected to fail in the coming weeks which were on the FSCS’s watchlist and were known to have advised on BSPS transfers.
“It is important to note that we regularly review our watchlist to consider all impacting factors and that the watchlist does evolve in line with those considerations. We are working with the appropriate parties involved to ascertain the impact that these failures might have on FSCS.”
The FSCS said the Financial Conduct Authority had written twice to all those it believes might have been subject to mis-selling.
“We will continue to see if there are other opportunities to reach out to steelworkers, including working with local MPs – like yourself, industry representatives, engaging at a local level in the community – with events such as the ‘boots on the ground’ in Swansea and Scunthorpe, social media, tailored documents, and other means,” Rainbird said.
The FSCS said where possible and in relation to steelworkers who were advised by failed firms, it works closely with insolvency practitioners to take on client information from failed firms.
The lifeboat scheme recently worked with the insolvency practitioner for AW Dallas, which went into default in November, to contact steelworkers to inform them they could make a claim with FSCS.
“We also have enhanced data sharing arrangements with the FCA which helps assist the flow of information and efficiently in reaching steelworkers who have been advised by failed firms,” she said.
Last year, the FCA said it was preparing to consult on a redress scheme for members of the BSPS and is expected to consult on this by the end of March 2022 having gathered further evidence and following engagement with stakeholders.
The redress scheme would be limited to BSPS transfer advice given between March 1, 2017 to March 31, 2018, and would ask firms to review their advice, and if found unsuitable, provide compensation.
Rainbird added: “I am conscious that this is at an early stage and details will need to be considered in line with the consultation responses from stakeholders.
“However, I can give you my assurance that we are feeding all the relevant information into the FCA to help their analysis. We will continue to do what we can to help them in their decision making.”
Last month the FSCS declared Channel One Financial Planning, trading as Channel One Financial Services, in default, and had received 17 claims at the time, of which 14 are for pensions transfer advice.
Around the same time, it declared another BSPS advice firm, Argent Wealth, in default.
sonia.rach@ft.com
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