Second MP joins FSCS levy reform fight after adviser letter

Balance Wealth Planning managing director Rebecca Aldridge told Professional Adviser that she had written to her local MP Edwards to express her opposition to the FSCS levy.

In the letter, Aldridge said she felt the levy funding model and structure was flawed.

She said: "We are operating within a regulated environment where the cost of regulation by the Financial Conduct Authority (around £600m) has been exceeded by the cost of compensating customers due to failed implementation and policing of those regulations. That's not right."

In response, Edwards recognised the concerns of the FSCS levy, particularly for SMEs and said she has written to the relevant minister at HM Treasury on Aldridge's behalf.

Aldridge said: "I was really pleased to have received such a speedy and comprehensive reply from Ruth. She has taken my concerns seriously and sent my suggestions to the relevant minister at the Treasury, which is exactly what I had hoped for."

Yellow Tail CEO Dennis Hall also told PA he sent a letter to his local MP Ben Bradshaw. "I know he's received it because he emailed me asking for my home address rather than my business address."

Hall used Penney Ruddy and Winter director and Chartered financial planner David Penney's letter as a base, making some alterations to appeal to Bradshaw's role as member of parliament for Exeter. "With an office in London and another in Exeter, I emphasised my company's role in advising clients in the South East, whilst doing the actual work in South West…," he said. 

He said the impact of the FSCS levy has stifled his ability to expand his team and therefore restricting the "flow of wealth" from each office. Hall said firms need to spell out to MPs how this is impacting on business growth, which will then impact their constituency.

Levy frustrations

Many advisers had recently vented their frustrations with the rising FSCS levy and have sent letters to their local MP. Advisers will face higher levy bills once again this year as the lifeboat fund is set to raise its overall levy to £635m for 2020/21 with advisers set to be collectively billed £213m.

This is in addition to a supplementary levy of £50m from the life distribution, pensions and investment intermediation class in 2019/20.

Last month, Penney wrote to MP Nickie Aiken, the MP for Cities of London and Westminster, the constituency in which his business is based. Aiken later told PA it was time for a review of the funding of the FSCS levy and that she would be writing to the relevant minister to take the next steps towards action.

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• Topics
• Your profession
• FSCS levy
• Rebecca Aldridge
• Financial Conduct Authority
• Ruth Edwards