The FSA has published Policy Statement 07/19: FSCS Funding Review - Feedback on CP07/5 and made text (PS07/19). PS07/19 outlines the FSA’s final policy for the future funding arrangements of the Financial Services Compensation Scheme (FSCS). It also gives feedback on the questions and issues raised in Consultation Paper 07/5: Financial Services Compensation Scheme Funding Review - Including feedback on DP06/1 (CP07/5). PS07/19 is set out as follows:
- Chapter 2 examines some of the overarching issues relating to the new funding model, including industry objections to the need for change and to cross-subsidy.
- Chapter 3 outlines the final model, including feedback on the funding structure, wholesale pool, levy raising procedure and recoveries.
- Chapter 4 confirms the final thresholds implemented for the sub-classes in the new model, including feedback on the methodology used to arrive at the thresholds.
- Chapter 5 sets out how the FSA will move to the new model and outlines the FSA’s position on the long-term tariff changes discussed in CP07/5.
- Chapter 6 sets out the FSA’s position on special cases including pre-funding, a product levy, insurance and borrowing, wrappers, personal pension schemes and wraps and fund supermarkets.
- Chapter 7 contains examples of the possible levies that different firms may be called on to pay in the future under different scenarios.
The new funding arrangements will be in force from 1 April 2008. From that date any future FSCS levies will be subject to the new model, thresholds and tariff arrangements confirmed in PS07/19. The FSA will be consulting on longer-term changes in Q1 2008 including a discussion on the proposed changes to the tariff measures for the investment intermediation and life and pension intermediation sub-classes, the fund management sub-class and both of the insurance provider sub-classes. The FSA will also be consulting on the 2008/09 fees and levies in early 2008.
View PS07/19: FSCS Funding Review - Feedback on CP07/5 and made text, 13 November 2007