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MPs table motion for FSCS funding reform

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MPs have called on the FCA and the Government to reconsider a product levy as part of the upcoming review of the Financial Services Compensation Scheme’s funding model.

A product levy was previously deemed out of scope of the review because it would require a change in legislation.

However, in an early day motion tabled on 25 May, Labour MP Alan Meale asked the regulator and Government to ensure the FSCS funding review will look at all possible solutions.

The motion says: “[This house] calls on the Government and the FCA, in the wake of the Financial Advice Market Review, to ensure the forthcoming FSCS levy approach examines all possible solutions, including a product-based levy and a whitelist of products, to support the creation of a more sustainable advice sector that is well placed to innovate and offer affordable advice to a broader range of consumers.”

The motion is supported by five MPs: Mark Durkan, Margaret Ritchie, Jim Shannon, Gavin Robinson and Gordon Marsden and was tabled by Meale following lobbying by Tenet and Apfa.

Tenet argues says by ruling out the product levy idea the FCA has “deliberately evaded the issue”.

Chief executive Martin Greenwood says: “Similar schemes work perfectly well in other sectors, such as the Motor Insurers’ Bureau and the Pension Protection Fund. Adopting one in financial services would fund the compensation scheme and support education initiatives aimed directly at the consumer.”

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Comments

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  1. Philip Castle 7th June 2016 at 7:07 pm

    Just an observation on the FCA’s double standards and why I will continue to refer to them public ally as a bunch of “shysters” and if I am alloyed to remain on APFA Longstop working party I will tell them to their faces this time why I think they are (not that it will make a blind bit of notice until they realize that if you push people like Harry Brown too far, they will eventually snap)
    It is funny how they tell is they can’t resolve the FSCS levy issues without legislation, but managed to override the statute which covers the longstop without legislation isn’t it?
    SHYSTERS

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