As you cannot have failed to notice, both in the press and, more crucially, by the letters landing on your doormats, the FSCS has raised its levy. Moreover, it has increased year on year since 2008 by an amount that really makes your eyes water.
For example, looking at Bradbury Hamilton, for the last couple of years, we have seen the levy increase first by a staggering six-and-a-half times and then more than double from last year to this year. To top it off, we were not even close to being the worst hit, not by a long way.
Although we knew that there would be a recalculation, I think it is fair to say that no one expected it to be nearly so high. Principals need to budget for each year carefully and it is nigh on impossible to do this with one hand tied behind our backs, not know- ing what figure the FSCS will plump for.
Now, to make sure advisers have a fighting chance, the FSCS needs to provide a better service in return for our hard- earned money.
Untying our hands can be done by simply providing adequate communication to advisers and reasonable payment periods once the bills have been sent. Otherwise, those only just getting by on their budgeting will be hit hard out of the blue.
As much as I appreciate that the FSCS has a job to do and a duty to consumers, there needs to be a transparent framework for the charges to be clearly understood by financial services profession- als, so that we can see an accounting for all of our hard- earned coppers going into the FSCS’s coffers.
After the Keydata misselling debacle and again with Arch Cru, there is a need for adequate provision for consumers. However, the important point is that a mechanism needs to be in place to structure the levy fairly throughout the whole industry.
I do not want to sound like a grouch but it is a worry that when other misselling issues inevitably come out of the woodwork, will we see another astronomical leap in the levy?
Will advisers have to take another hit when some are already struggling with changes in the industry with RDR approaching or are there measures that can be put in place before we get to this stage? We need the FSCS to reassure us that there will be a sensible ceiling placed on charges.
So what now? Collective action is always something to be applauded and we should take our hats off to Martin Bamford and the FSCS Levy Action Group campaign for taking their very similar concerns on the FSCS levy to the powers that be – the FSA, the FSCS and the Treasury.
The impact on the industry will be nationwide and we need to ensure as a collective that all future levies are cost-appropriate and transparent as I fear this is an issue that will not be going away any time soon.
Sheriar Bradbury is managing director of Bradbury Hamilton