News - Regulation
Categories: Regulation
Topics: Fsa | Cost benefit analysis | Rdr
The FSA has made a major upward revision of the RDR’s costs in its policy statement today.
Costs to intermediary firms have risen three-fold to £120m annually.
Annual costs could be more than five times as expensive as the FSA initially predicted in June last year.
Ongoing annual costs may rise to over £200m, the FSA says, compared with early estimates of just £40m.
Total costs in the first five years could hit £1.7bn, almost three times the £0.6bn figure quoted in last June's consultation paper.
One-off costs on implementing the RDR could be up to 75% higher than expected at £750m.
Advisers' one-off costs are expected to rise to as much as £370m, compared with initial estimates of £210m. Ongoing costs could treble to £120m a year.
Product providers' one-off costs have increased by a similar amount, up from £220m to as much as £385m.
Ongoing costs for providers have risen significantly. In June the FSA said the annual costs would be 'negligible', but now believes RDR will cost providers between £70m and £85m each year.
Categories: Regulation
Topics: Fsa | Cost benefit analysis | Rdr
Comments
Outrageous!
This merely confirms what the IFA Sector has always believed - that the costs of RDR substantially outway all the likely benefits. The FSA should be prevented from implementing the Review and then subjected to a Judicial Review.
They are an organisation operating without any meaningful control or subject to little or no accountability
Posted by: David Yorke
26 Mar 2010 | 12:34
Increase Costs ?
In order for the captive market adviser community to be able to pay the 'slightly' increased costs, perhaps product costs and commission payments should be increased so that we can afford to pay them ? Be good to see that explained in an IDD / Key Facts document !
Posted by: John Nightingale
26 Mar 2010 | 13:16
Why am i not surprised
Have the regulators ever got their costings right?
Yet we just sit back and accept it. Noone will saction the FSA for getting there costings wrong in the same way they werent sactioned for presiding over the greatest financial disaster in living memory. They do regulate the banks too dont they?
Like all major FSA initiatives they create loads of employment for the FSA and the benefits elsewhere are limited particularly in relation to clients. Clients are surely meant to be the benefators of legislation. I think the consumer protection was lost way back!!
Posted by: Ian Ronson
30 Mar 2010 | 11:47
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Par for the course of the FSA.
Just hope they do not make the same mistakes on their costs as 5 x £1/2 billion is massive !!
Posted by: Michael Fallas
26 Mar 2010 | 12:22
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