FOS confirms levy freeze for 2012/13

clock

The Financial Ombudsman Service (FOS) has set its budget for 2012/3 at £191.1m, meaning both the case fee and total levy will be frozen for the third year running.

Advisers will continue to be charged at £500 for each case above the first three reported.

The FOS's projected budget for 2012/13 is more than £6m short of its expected costs for the forthcoming year, but this is covered by a £6.6m budget surplus in 2011/12.

The overall levy for the "compulsory jurisdiction" has been set at £17.7m, with the levies for the "consumer credit jurisdiction" and "voluntary jurisdictions" at a combined £2m.

The Ombudsman also announced firms caught in the PPI mis-selling scandal would face a supplementary case fee of £350, above the first 25 cases per year.

Of the 260,000 cases FOS expects to resolve during the year, around 130,000 will relate to PPI.

The Ombudsman said the break was due to the "unprecedented volumes of PPI complaints", with the "industrialisation" of PPI complaints-handling across the financial services sector. The expected cost of a single PPI complaint is around £760.

"This higher cost - which the supplementary case fee of £350 is intended to bridge - reflects a number of factors unique to cases involving mis-sold PPI," the Ombudsman said.

"In particular, we are managing our unprecedented PPI caseload as a single unit, which involves significant up-front costs - including the acquisition of new premises, and the development of new operational processes.

"The recruitment and training of large numbers of new staff will be a particularly significant cost in relation to PPI in 2012/3."

More on Regulation

UK unemployment rate continues to stall in August

UK unemployment rate continues to stall in August

Economic inactivity at 21.1% in May to July 2025

Michael Nelson
clock 16 September 2025 • 3 min read
The COVER Review: A budget on the horizon, private healthcare and product launches

The COVER Review: A budget on the horizon, private healthcare and product launches

Week commencing 1 September 2025

COVER
clock 05 September 2025 • 1 min read
Autumn Budget 2025 set for 26 November

Autumn Budget 2025 set for 26 November

Investment and reform

Cameron Roberts
clock 03 September 2025 • 3 min read

Highlights

COVER Survey: Advisers damning of protection insurer service levels

COVER Survey: Advisers damning of protection insurer service levels

"It takes longer than ever to get underwriting terms"

John Brazier
clock 12 October 2023 • 5 min read
Online reviews trump price for young people selecting life and health cover

Online reviews trump price for young people selecting life and health cover

According to latest ReMark report

John Brazier
clock 11 October 2023 • 2 min read
ABI members with staff neurodiversity policy nearly doubles

ABI members with staff neurodiversity policy nearly doubles

Women within executive teams have grown to 32%

Jaskeet Briah
clock 10 October 2023 • 3 min read