Platform reforms will cost £127m

17 November 2010 0:00 am | Updated: 17 November 2010 9:55 am | By Chris Salih

The FSA says the industry is set to be hit with £127m of one-off compliance costs on the back of its latest platform proposals.

The regulator says that both platform operators and other intermediate unit-holders can expect to be charged £60.2m to meet the new proposals, while fund managers will be hit with a £6.6m charge.

Platform operators can also expect to pay £25.3m of ongoing costs, while other intermediate unitholders can expect to pay £21.2m. Fund managers will have ongoing costs of £1.1m.

The FSA says that approximately £70m of one-off costs and £34m of ongoing costs are attributable to the proposals on the provision of information to fund managers and underlying investors. A further £26m of one-off and £9m of ongoing costs are due to the ban on cash rebates to consumers. The rest is down to the disclosure of payments that platform receive from fund managers and product providers, which account for a £25m one-off and £3m ongoing costs and proposals on mandatory re-registration, which levy a £7m one-off and £2m ongoing cost.

The regulator says that RDR-related proposals account for £50.9m of the one-off costs as well as £12m ongoing costs. Registration proposals account for £7.4m on one-off costs and £2.1m of ongoing costs. Provision of information proposals accounts for £68.7m of one-off costs and £33.6m ongoing.

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