The FCA is to consult on changes to the way it calculates minimum annual fees after concerns were raised that larger firms are subsidising small businesses.
In its final fees and levies paper for 2014/15, published today, the regulator confirms it is keeping minimum fees unchanged at £1,000 for the fifth year running.
But the FCA says it will consult in October on a range of alternatives for calculating the minimum fees.
It says there was a “mixed response” to the proposal to keep minimum fees unchanged, with four respondents in favour and four against.
An FCA spokesman says: “Some respondents expressed concern that larger firms are subsidising small firms because the fees have remained unchanged for five years.”
The FCA consulted on 2014/15 regulatory fees in March. The regulator proposed charging A13 advisers £68m, down 19 per cent from £83.6m in 2013/14.
Today’s paper confirms the proposals, which include the merger of the A12 and A13 fee blocks.
The A13 fee block relates to advisers who do not hold client money, while A12 relates to advisers, dealers and brokers who hold client money.
The FCA says some respondents raised concerns that advisers continue to pay too much, because the A13 fees for 2014/15 account for 15 per cent of the FCA’s total annual fees.
But the FCA says: “Although we allocate 15 per cent (£68m) of our annual funding requirement to the A13 fee-block it is not only recovered from financial advisers. We estimate that the amount recovered from financial advisers to be £6m (8.5 per cent) and the number of financial advisers to be 55 per cent of the total firms that pay fees in A13.”
The regulator says there was also criticism of the impact of consumer credit fees on mortgage and investment intermediaries who argue they have to pay fees even if they earn no direct income from consumer credit.
Apfa has previously said that further clarity is needed on when advisers need a consumer credit licence.
But the FCA says: “Our fees for mortgage and investment intermediaries follow firms’ permissions and individual firms must judge whether they need consumer credit permissions to do business.”