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FCA outlines levy plans for new govt guidance body

FCA-regulated firms will continue to fund the cost of pensions guidance and debt advice as the government moves to a new single public guidance body, the regulator has confirmed.

Business contributing to the cost of debt advice in the UK will continue to do so but through split levies – one administered by devolved authorities in Scotland, Wales and Ireland, and one for the new Single Financial Guidance Body specifically, the FCA says.

The SFGB is set to role the functions of the Money Advice Service, Pension Wise and The Pensions Advisory Service.

In a consultation paper released today, the watchdog says the SFGB levy will replace MAS and Pension Wise levies for the 2019/20 financial year, meaning levies changes will cancel each other out.

The SFGB levy rules started this year and are made up of money advice, debt advice, and pensions guidance levies.

This applies to both the SFGB money advice and debt advice levies.

The FCA says the SFGB levies contribute to the recovery of the Department for Work and Pensions’ costs of operating the combined Money Advice Service, Pension Wise and TPAS.

Monies from SFGB levies for this financial year were predominantly used for sett-up costs, however.

On-account payments are due on 1 April while the balance of the fee or levy is due 1 September 2019.

FCA continues probe into high-risk investment advice

The regulator also outlined plans to scrap levies for mutual societies registered on the mutuals register but not authorised or regulated by the FCA.

Costs for the register as a public service will now be recovered as an FCA overhead.

It says: “This would represent an addition of approximately 0.3 per cent to the fees of variable fee-payers.”

Responses to the proposals in the consultation are due by 14 January, with the FCA’s feedback and rules then expected next February or March.

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Comments

There are 5 comments at the moment, we would love to hear your opinion too.

  1. Here is an idea, why doesn’t the Guidance Body take over the initial guidance for all DB Transfers?

    They could develop the videos and information, with a certificate to state the potential client undertook the guidance, to be taken to an adviser if they wish to explore full advice. The document could even request the client to state having taken the guidance why they still wish to proceed to look at a transfer and why they believe this is an option for them.

    At least this way advice would be truly taken away from the process, the Government and Regulator would be able to have certainty and control of the information supplied.

    It would remove the uncertainty and prevent advisers straying into advice. A copy of the information supplied could be included in the advisers submission.

    We pay towards the Guidance Body and this would be a good way of using our funding effectively.

  2. Nicholas Pleasure 15th November 2018 at 4:34 pm

    If my levy can help Hector Sants and his new virtue signalling organisation then I’m happy. I would be prepared too sell my house, car and children to fund anything organised by Hector. The man is a flippin’ financial services genius. You only need to look at the great shape he left the FSA in too see that.

    …oh hang on.

  3. Regulated firms will continue to fund levies and this new guidance body …….EErrr NO !

    The “CLIENTS” of regulated firms will continue to fund these levies !!! You (FCA)bill the regulated firms they pass this on to their clients !

    Perhaps then the FCA would like to share and explain with the consumer why ?

  4. Why should regulated advisers be forced to fund a government initiative, particularly in respect of counselling those who’ve got themselves into debt, either through lack of financial savvy, misfortune or plain stupidity. Such issues have nothing whatsoever to do with the provision of advice on building and protecting the very opposite of debt. In fact, as I understand it, at least as far as my network is concerned, we’re not even allowed to advise on debt, other than to tell people always to pay it down as soon as they reasonably can.

  5. Trevor Harrington 30th November 2018 at 4:34 pm

    This is just one more example of regulation perpetuating regulation, and passing the cost onto the subjects of that regulation (us).

    Oh how I wish they would take advice from those who they seek to regulate, before they suggest their ideas (such as Martin Evans – above).

    The regulator’s theory may or may not be a good one, but as has always been the case with new ideas from the regulator, unless they take advice about the practicalities and likely success of such ideas, then they are doomed (doomed I say !) to fail, to a lesser or greater degree.

    Dear Mr FCA – Tell us what you are trying to achieve, and then sit back and listen for a while … and you might learn something.
    Yours sincerely – A person who your refer to as a Dinosaur.

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