On 31 March 2016, the PRA issued a policy statement (PS12/16) on the Financial Services Compensation Scheme (FSCS) management expenses levy limit (MELL) for 2016/17. Following feedback to the joint PRA and FCA consultation paper (CP4/16), the MELL for 2016/17 has been set at £72.7 million. This figure comprises budgeted FSCS management expenses of £67.4 million and a contingency reserve of £5.3 million.
The Financial Services and Markets Act 2000 require the PRA and FCA to set a limit on the total management expenses to be levied. The MELL represents the maximum management expenses that the FSCS can incur in that year. The PRA instrument making the amendments to the FSCS Management Expenses Levy Limit and Base Costs Part of the PRA Rulebook is the PRA Rulebook: Non Authorised Persons: FSCS Management Expenses Levy Limit and Base Costs Instrument 2016 (PRA 2016/22). The instrument came into effect on 1 April 2016.
The FCA published its policy statement on 29 March 2016, confirming the MELL for 2016/17 for the FSCS is £72.7 million.