FSA costs are to rise by 10 per cent from £454.7m to £500.5m but the total fees paid by advisers will reduce due to money collected through fines.
For 2011/12, the minimum fee paid by 43 per cent of the FSA’s authorised firms, including many IFAs, will fall by 9 per cent from £925 to £844.
The fee block for advisers not holding client money falls by 2 per cent from £40.6m to £39.7m, although the fee block for those handling client money rises by 88 per cent from £26.4m to £49.7m. The regulator says any increase in costs will be borne by larger firms, reflecting more intensive supervision of “highimpact firms”.
Cash from FSA enforcement fines means firms will pay 2 per cent less than last year in total. In the first nine months of 2010/11, the FSA collected £79.1m of fines compared with £33m in 2010.
For 2011/12, the FSA says the total net cash cost of the FSA, Financial Services Compensation Scheme, Financial Ombudsman Service and Consumer Financial Education Body falls by 18 per cent, from £1.323bn to £1.09bn mostly down to a reduction in FSCS costs.
CFEB funding rises by 32 per cent from £32.9m to £43.7m, with advisers paying £4.3m, up from £3.2m.
Aifa policy director Andrew Strange says: “We welcome a reduced fee for the majority of IFAs but we must ensure there are better checks and balances in place under the new regulatory structure to prevent ever spiralling costs.”