Plan and Budget 2008-09
Sub-class D1 Investments - fund management |
£7m 2008/09 estimated gross initial funding requirement |
Cost drivers |
Claims relating to splits (BFS & Exeter) plus a share of FSCS management expenses. |
Any credit or debit from previous contribution groups? |
YES - £6m DEBIT. Firms in A7 and A9 are expected to share an estimated £6m debit carried forward (£0.9m - A7 and £5.1m A9). |
What will firms in this Sub-class pay? |
The amount to be paid by individual firms is their share of the £7m funding requirement, according to their 2008/09 tariff data, plus any debit in respect of their membership of A7 and/or A9.* |
The estimated funding requirement in this Sub-class is £7.0m. Based on current claims estimates, there will be a projected funding deficit of £6.0m for splits claims relating to the previous contribution groups A7 & A9 at 31 March 2008.
This deficit arises because no levy was raised for these splits costs during 2006/07 and 2007/08.
We expect to deal with the bulk of new splits claims within 2008/09, although these claims may continue into 2009/10.
As we indicated in Outlook in December, the majority of Exeter claims have been allocated to the A9 contribution group and the majority of BFS claims have been allocated to the A7 contribution group. Each claim is allocated according to its facts.
These claims are very complex, and the current uphold rates and average values may not be representative of splits claims overall. Our estimated funding requirement for these claims is therefore only indicative. Based on current trends, the majority of claims are allocated to this Sub-class with only a handful currently being allocated to intermediaries.
* Firms will only receive credit or debit notes from previous contribution groups if they were a member of a previous contribution group from 1 April 2007. Details of the transition rules are available from the FSA (PS07/19, FSCS Funding Review - Feedback on CP07/5 and made text).
