Question to the HM Treasury:

To ask the Chancellor of the Exchequer, if he will hold discussions with the Financial Conduct Authority on increasing the frequency of reviews of the £85,000 limit in compensation for savers and investors in the event of the demise of financial institutions.

Under the Financial Services and Markets Act 2000 (as amended), the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA) have statutory responsibility for making rules on how the Financial Services Compensation Scheme (FSCS) should provide compensation when authorised financial services firms are unable to meet claims against them. This responsibility includes setting the limits for compensation payments made by the FSCS. The FCA carries out reviews of FSCS compensation limits independently of government.

The FCA published a discussion paper on 6 December 2021, which invites views on key elements of the FCA’s compensation framework and remains open for responses until 4 March 2022. The paper includes discussion of the FSCS compensation limits which are set by the FCA. The FCA discussion paper can be found at:

https://www.fca.org.uk/publication/discussion/dp21-5.pdf