The FCA has provided further clarity on the £13.4m cost it expects to incur by extending the Senior Managers Regime to all financial services firms, including advisers.
Responding to a Freedom of Information Act request, the FCA said that it has budgeted £514,000 – of which it has so far spent £4,000 – for external consultancy work on the project.
The more than half a million spent on policy support consultants will primarily help the regulator analyse industry responses to its consultation papers on the regime, the FCA says.
The regulator is also involving its in-house lawyers in the project, with the cost of staff time expected to come in at around £368,000. £113,000 of this cost has already been incurred.
In another FOIA request released by the regulator, it confirms it has spent comparatively far less on external consultants for its recent review of advice suitability, with just £7,662 paid from the start of the project in April 2016 to when the results were published in May this year.
The FCA notes: “The Assessing Suitability Review has been undertaken by FCA staff performing standard supervisory activities at no additional cost.”
Up to July this year, the regulator says it has spent a total of £1.7m on the Senior Managers Regime extension.
The FOIA response reads: “Following the implementation, there’s not expected to be any significant change in the level of resources used by the FCA, relative to the costs of regulating the current regime.”
The regulator is running a series of regional forums about the proposed changes after releasing its main consultation on the plans in July.
In total, it is predicting a £547m up-front expense for the entire financial services industry from the changes.
Smaller firms, like one-man-band IFAs who only have to adopt a limited version of the rules, will face ongoing costs of between £53m and £76m, the FCA predicts.