Financial Services Compensation Scheme

(asked on 2nd March 2020) - View Source

Question to the HM Treasury:

To ask the Chancellor of the Exchequer, whether he has made an assessment of the potential merits of changing the allocation of the Financial Services Compensation Scheme levies on businesses to reflect the relative risk associated with different business models; and if he will make a statement.


Answered by
John Glen Portrait
John Glen
Paymaster General and Minister for the Cabinet Office
This question was answered on 9th March 2020

The Financial Services Compensation Scheme (FSCS) is an independent non-governmental body. The FSCS carries out its compensation function within rules set by the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA), who are also independent from government.

The FSCS levy is set annually by the FSCS within the limits set by the FCA and PRA. It is for the FCA and PRA to consider the impact of the levies on the firms they regulate, acting in line with their statutory duties. The Government has no role in setting the levy.

The FCA regularly consults with the financial services sector regarding its fees policy. This includes the funding of the FSCS. The FCA most recently consulted on the funding of the FSCS in May 2018 as part of a three-year review of the FSCS funding model.

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