The UK Prudential Regulation Authority (PRA) has issued a policy statement finalising the Financial Services Compensation Scheme (FSCS) Management Expenses Levy Limit (MELL) for 2026/27 at GBP 113 million, providing feedback on consultation responses and confirming the proposals unchanged. The final rule applies to all FSCS levy-paying firms authorised by the PRA and the Financial Conduct Authority (FCA). The GBP 113 million limit comprises a GBP 108 million management expenses budget for ongoing operating costs and operational improvements, plus a GBP 5 million unlevied reserve to meet unforeseen costs without further consultation. Two respondents broadly supported the proposals; the PRA rejected a suggestion to exclude credit unions from contributing to revolving credit facility costs, on the basis that the facility may be used for any short-term FSCS funding need and should be funded proportionately by all firms. The FSCS has revised its 2025/26 forecast to a GBP 2.5 million underspend, which, if confirmed at year end, will be used to offset 2026/27 levies for the relevant classes; the MELL applies from 1 April 2026 to 31 March 2027, and the FCA Board has made its corresponding rule.
Prudential Regulation Authority 2026-03-31
UK Prudential Regulation Authority finalises FSCS 2026/27 management expenses levy limit at GBP 113 million
The UK Prudential Regulation Authority has finalised the Financial Services Compensation Scheme Management Expenses Levy Limit for 2026/27 at GBP 113 million, confirming its consultation proposals unchanged. The limit comprises a GBP 108 million management expenses budget and a GBP 5 million unlevied reserve, applies to all levy-paying firms authorised by the Prudential Regulation Authority and the Financial Conduct Authority, and will be offset by a forecast GBP 2.5 million underspend from 2025/26.