Regulation

AIFA launches industry group to challenge FSA fee increase

18 February, 2009

The group, to be chaired by Director General, Chris Cummings, is being formed in response to the proposed fee increases from the Financial Service Authority (FSA).

Chris Cummings, Director General, AIFA and AMI, commented: "Across the country, in all industries, firms are struggling with the bleakest business outlook for decades. The CBI has recently estimated that 3 million people could soon be jobless - and the Government has announced a package of proposals to help firms weather the economic storm. Firms are doing their best to meet client demands while trying to cut costs just to stay afloat. As we set out in our response to the Financial Risk Outlook (FRO) and the Fees and Levies Consultation (CP09/7), this is a time for the regulator to work with, and in support of, the wider financial services industry.

"We support the case made by FSA to charge the banking community more for its regulation - but cannot agree with the unwarranted level of fee increases proposed for the intermediary community, who have not caused the banking crisis but have been affected by its fallout.

"We are today announcing the first in a series of activities that we intend to carry out to respond to these proposals - the formation of a cross-industry body the "Regulatory Fees Strategy Group". This group, consisting of AIFA and AMI members, will represent the interests of the intermediary community in our campaign to have these proposals revised and FSA budgeting process overseen by the National Audit Office.

"The strength of member feeling towards the proposed fee increases has been significant. We are issuing an open invitation to all members who would like to take part in this group to come forward.

"The proposals set out in the consultation paper pose a grave threat to many intermediary businesses, individuals and their clients. No business can simply absorb an increase in costs to the extent proposed. The regulator has endangered some good, financially robust businesses, through these proposals. Doubtless, AIFA and AMI will not be alone in expressing surprise and disappointment with the regulator at this time.

"There has never been a more important time to support the trade associations in fighting for your interests."

Members who are interested in joining the "Regulatory Fees Strategy Group" should contact Tracy Elwick, Director of Public Relations and Marketing via email to Tracy@aifa.net