The headlines of 25% provider contributions and merging funding classes made the proposed FSCS changes appear a gift that would save advisers a lot of money on levies but, writes Tom Ellis, this is far from the case.
Advisers have long criticised the current funding system of the Financial Services Compensation Scheme (FSCS) as "unfair" - often describing it as the "good guys pay" levy because all advisers have to pay into the lifeboat fund to compensate those who, generally, fail because of risky investments. The FSCS has repeatedly pointed out that transfers into self-invested personal pensions (SIPPs) and subsequent risky investments have driven up annual levies, and prompted interim levies, in recent years. The Financial Conduct Authority (FCA) on Monday tried to address this unpopular issue b...
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