FSA backs down on fee hikes

The Financial Services Authority (FSA) has today issued a policy statement setting out their final decision on the level of regulatory fees and levies for the 2009-2010 financial year.

The policy statement shows that a significant amount of contingency funding has been moved to the depositor takers block, leading to significant reductions in the originally proposed fees.

Eric Gabraith, BIBA chief executive, said: “BIBA felt very strongly that the original fee proposals were, in respect of insurance intermediaries, unfair. We responded in strong terms to the FSA and actively encouraged our members to do likewise.”

Galbraith added: “We are pleased that the FSA have reconsidered both their funding requirements and the allocation of these costs and that the voice of BIBA and its members has been listened to in the process.”

In a statement, the FSA said: "As a result of the detailed review of the cost allocation of the 2009/10 budget, feedback from its consultation and cost savings made by the FSA, there have been changes to some of the fee rates proposed in February’s consultation paper. The result is that that some firms will see their proposed percentage fee increase drop and others will experience a higher fee increase than originally proposed.

"Although individual firms’ fees will vary widely according to a firm’s size, activities and individual circumstances, some groups of firms (fee blocks) will be subject to lower overall fees than those initially proposed in February. For example, the total amount of fees assigned to mortgage advisers had been proposed to rise by 21.2% compared to last year but the increase will now be 2.7%. Likewise, the total fees payable by one of the financial adviser fee blocks will increase by 4.8% compared to the 15% increase proposed."

For more, see the FSA Policy Statement.