The Financial Services Authority (FSA) has announced it will require £78 million pounds more funding than it did last year, as it announces it’s proposed Annual Funding Requirement (AFR) for 2012/13.
Last time, the FSA required £500.5 million but a number of factors contributed to a gross increase of 15.6 percent, taking the latest figure to £578.4 million.
A spokesman from the FSA told News Insurances that this would roughly equate to an increase of 37 percent for bigger companies.
The AFR for 2012/13 is likely to be the last before the introduction of the Prudential Regulation Authority and the Financial Conduct Authority.
They credited the increase to a number of factors. An increase of £32.5 million was required to implement the governments UK regulatory framework, and a further £22.4 was needed for the modernisation of the IT infrastructure. The rest would go towards maintaining the FSA’s core programs for the year.
Hector Sants, FSA chief executive , said, “the AFR is rising as we implement the government’s regulatory reform programme and invest in the necessary long term IT infrastructure.
“The increases will be borne mainly by larger and more complex groups. We have, however, minimised the impact on smaller firms by keeping the minimum fee at £1,000 for the third year running.”
Currently 42 percent of the FSA’s authorised firms only pay the minimum amount, however a number of medium sized firms are expected to see a proportionate increase in their fees next year.
£32.5 percent of the increase is to go towards an internal restructure, but Sants says this is a justified amound.
“Much of the increase in AFR is the result of the additional resources needed to implement the new regulatory structure but these costs for the restructuring are in line with government forecasts,” Sants continued.
“The FSA will continue to deliver intensive and intrusive supervision and develop the key policy initiatives but we are not planning any new discretionary initiatives.
“The principal initiatives are progressing the domestic consumer protection strategy, implementing a number of key EU directives and influencing the continuing international regulatory reform agenda.”
