The FSA’s proposed Annual Funding Requirement (AFR) for 2011/12 is 10.1% greater than for 2010/11. The AFR for 2011/12 is £500.5 million, up from £454.7 million in 2010/11.
The regulator says that the increase will be borne by larger firms, reflecting the resources applied to intensive supervision of high impact firms.
However, the enforcement fines the FSA imposes during the previous year are returned to the industry by way of discounts to their fees in the following year. This means that in total firms will pay 2% less than last year.
Most firms authorised by the FSA pay a minimum fee, with further variable fees to be paid depending on the type of business a firm conducts. The gross minimum fee for firms will remain unchanged from last year but, taking into account the enforcement fines discount, the net minimum fee will be 9.4% less than last year: 43% of the FSA’s authorised firms will only pay the minimum fee.
Hector Sants, FSA chief executive, said: “The completion of the FSA’s changes to move to a more intensive approach to financial services regulation has inevitably led to some increase in the Authority’s cost base. However
