FCA to increase adviser fees by 8.75% this year

The FCA has announced new increases to fees paid by advisers and brokers for the 2024/25 year.

In the A13 block, which covers advisers and brokers, fees increased by 8.7% in the current 2023/24 year to £94.6m and are expected to increase further by 8.7% to £102.8m in the 2024/25 year.

Last year, due to the inflationary pressures firms faced, the FCA froze minimum and flat rate fees, as well as application fees, to ease cost pressures on the smallest firms.

However, this year the regulator is increasing fees in line with the increase of its ongoing regulatory activities (ORA) budget and will revert to staged increases of A-block and consumer credit minimum fees from 2024/25.

The FCA's business plan shows the base ORA budget increasing by 8.75% and, as a result, the regulator will increase minimum and flat rate fees, as well as application fees, in line with the 8.75% increase.

However, the A13 block is also estimated to receive a 2.9% rebate this year from financial penalty revenues retained in 2023/24.

Explaining fee increases for A-block firms this year, the FCA noted costs relating to its review of the boundary between advice and guidance, which are expected to total £1.9m.