PRA and FCA consult on FSCS levy limit

FCA and PRA have issued a joint consultation paper on the management expenses levy limit (MELL) for the FSCS for 2017/18. The MELL provides the FSCS with adequate resources to process compensation claims resulting from the failure of financial services firms. The MELL proposed is £75.54 million, which is the maximum amount the FSCS can levy to meet its management expenses without further consultation. FSCS’ management expenses have increased by £1.847 million (2.74%) from 2016/17, mainly because of increased outsourced claims-handling costs due to projected higher volumes of complex claims. Consultation closes on 13 February 2017. The finalised rules will take effect on 1 April 2017 and invoices will be sent out from July 2017.