The FCA has confirmed advisers will see their regulatory fees drop 1.6% in 2016/17.
In a consultation paper in April, the FCA proposed a levy of £73.7 million from advisers to fund the regulator for the 2016-17 financial year, 1.6% down on the £74.9 million levied the previous year.
The drop reflected a cut in fees across the majority of fee blocks, as the cost of regulatory activities excluding consumer credit dropped £7.6 million, or 1.6% overall.
Advisers’ funding for the Money Advice Service was originally projected to fall 25%, from £4.2 million to £3.1 million. However, a greater amount of consumer credit contributions that expected means this has been further cut to £2.9 million.
Though the Financial Ombudsman Service’s (FOS) general levy edged up by £1.2 million to £24.5 million on the back of it taking on claims from consumer credit firms, advisers’ contribution held steady at 2%.
The FCA also estimated a £4.2 million rebate for the adviser funding block from fines levied against advice firms.
The FCA said it would not change its allocation of Pension Wise or FOS funding on advisers after the consultation.
‘We estimate that around 3,108 financial advisers, whose main business is to provide advice on retail investment products, will contribute £270,000 (10%) of the £2.7 million Pension Wise funding requirement allocated to the A.13 feeblock. This means that these firms contribute 1.2% of the total £22.5 million Pension Wise funding requirement. The £270,000 contribution represents 0.01% of the £2.8bn income these firms repost for fees calculation purposes.
‘We do not believe that the levy on any particular fee block is disproportionate given that the levy is a small part of the overall Financial Ombudsman Service budget, and all levy payers benefit from the existence of the Financial Ombudsman Service.’
The consultation had 13 responses.
In response to comments on the MAS levy, the FCA said it would consult on the allocation method for the new money guidance body to be set up from April 2018.