PIMFA welcomes Financial Services Compensation Scheme levy forecast for 2024/25

9 November 2023

PIMFA welcomes Financial Services Compensation Scheme levy forecast for 2024/25

PIMFA, the trade association for wealth management, investment services and the investment and the financial advice and planning industry, has welcomed the news that the Financial Services Compensation Scheme (FSCS) levy will remain unchanged for the remainder of this financial year (2023/24) and the first forecasts for the levy for the next financial year (2024/25).

Simon Harrington, Head of Public Affairs at PIMFA comments: “We welcome today’s news that no additional levies will be raised for the Financial Services Compensation Scheme (FSCS) for the remainder of this financial year (2023/24). While the existence of the FSCS and the protection it provides remains a fundamental part of the financial services landscape, it remains the case that the cost of funding it represents a significant financial burden and barrier to growth for firms in this sector. More broadly, while the levy forecast for 2024/25 is lower than in previous years, indicating lower levels of consumers who have been let down, it remains the case that it is an uncontrolled cost to firms and penalises well-run firms for the failures of others.

“While we recognise that this represents a stabilisation of the cost of funding the FSCS, we remain of the view – given the likelihood of future claims working their way through the system – that FCA fines to be used to subsidise the FSCS levy, rather than being directed towards the Exchequer would represent a much fairer system and truly represent a polluter pays model the entire financial services industry agrees on. This is the fairest way to ensure consumers get the protection that they need whilst lifting a considerable burden on firms.”

 

NOTES TO EDITORS

About PIMFA – the Personal Investment Management & Financial Advice Association

• PIMFA is the trade association for firms that provide wealth management, investment services and the investment and financial advice to everyone from individuals and families to charities, pension funds, trusts and companies.
• The sector currently looks after £1.65 trillion in private savings and investments and employs over 63,000 people.
• PIMFA represents both full and associate member firms. Full members provide a range of financial solutions including financial advice, portfolio management, as well as investment and execution services. They assist everyone from individuals and families to charities and pension funds, all the way to trusts and companies.  Associate members provide professional services to the PIMFA community.
• PIMFA  leads the debate on policy and regulatory recommendations to ensure that the UK remains a global centre of excellence in the wealth management, investment advice and financial planning arena. Our mission is to create an optimal operating environment so that its member firms can focus on delivering the best service to clients, providing responsible stewardship for their long-term savings and investments.
• PIMFA has made numerous recommendations to the FCA regarding the Future of Advice, the Future of Supervision and the FSCS levy – read more.
• PIMFA was created in 2017 as the outcome of a merger between the Association of Professional Financial Advisers (APFA) and the Wealth Management Association (WMA) with a history as a trade association since 1991 – read more.
• Find out more about PIMFA’s Diversity and Inclusion work – read more
• Further information can be found at pimfa.co.uk

Contact

For further information on this release or other press matters please contact:

Matthew West, PIMFA PR Manager – MatthewW@pimfa.co.uk, +44 (0)20 7382 0376

Sheena Gillett, PIMFA Communications & PR Director – sheenag@pimfa.co.uk, +44 (0)20 7011 9869