An influential think tank says the proposed 15.6 per cent hike in the FSA’s annual costs will add to an ever-increasing burden on consumers and should be reversed.
On Friday, in a consultation paper on fees and levies for 2012/13, the FSA proposed a rise in its annual costs from £500.5m for 2011/12 to £578.4m the year after.
The Institute for Economic Affairs says the rise comes on top of large increases in previous years.
IEA editorial director Prof Philip Booth says: ““This budget rise must be reversed. This is a monopoly that is able to set its own fees. A 15.6 per cent rise is proposed for this year on top of huge rises in previous years – after this increase the FSA’s budget will have doubled in just six years.
“Only the FSA could march on completely oblivious to the folly of more and more complex regulation at an ever-increasing direct and indirect cost to financial consumers.”
The FSA’s consultation paper shows that despite the overall increase, fees for advisers not holding client money have fallen by 3 per cent from a total of £39.7m to £38.4m. Fees for advisers holding client money have dropped 19 per cent from a total of £49.7m to £40.2m.
However, fees for life insurers have gone up 37 per cent from £44.5m to £61.1m. Fees for fund managers have also jumped 32 per cent from £28.2m to £37.3m.