Pension advisers’ FSCS levy hits £90m following Sipp claims

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Life and pensions advisers are to pay a levy £10m higher than forecast as a result of rising claims against Sipp advice.

Pension advisers will pay £90m in FSCS levies in 2016/17, up from a forecast of £80m published in January. This compares to a levy of £100m paid in 2015/16.

All other advice sectors will pay a lower levy than was predicted, including investment advisers who will pay £94m, down from £108m.

The levy totals £337m, down from the £363m forecast in January but up 2015/16 where it was £319m.

FSCS managing expenses are budgeted for £67.4m in 2016/17 and the scheme will recover £337m of interest costs relating to Treasury loans to Bradford and Bingley and Kaupthing Singer & Friedlander made during the banking crisis in 2008.

FSCS chief executive Mark Neale says: “The annual levy allows us to compensate customers. That generates consumer confidence and trust in the industry.

 “We look forward to the forthcoming review by the Financial Conduct Authority into how FSCS is funded, and will play our part in discussions. I encourage the industry to play a full role in the debate.”

FSCS 2016/17