Personal Touch Financial Services is to raise its fees from October in response to rising FCA and professional indemnity costs.
The network wrote to members last week to explain that costs would increase before the year-end, with firms paying an extra £4 for FCA bills. Brokers will pay a further £36 per adviser and IFAs a further £114 for each adviser they employ.
PTFS will also charge an extra £150 for each adviser authorised for both pensions and investments as well as mortgages, with both increases going towards FCA fees.
In a letter to members, PTFS sales and marketing director David Carrington says: “We have already paid these levies and the increased FCA fees in full.
“While we would normally apply changes to regulatory recharges in our year-end fee review, in view of the scale of increases and to minimise the monthly impact on all our firms we are writing to inform you the changes to regulatory recharges will be implemented from 1 October 2015.
“Please note that for firms with three and six months’ notice periods, the implementation dates will be either 1 December 2015 or 1 February 2016.”
Costs for PI cover will also rise by £15 per firm, in addition to a further £4 per broker, £8 per investment or pension adviser and £12 for those individuals authorised for both.
PTFS says it will continue to subsidise the cost of PI cover by around £500,000 in 2015/16. Member support fees remain unchanged for the time being.
Carrington says: “The relatively good news is that we have recently renewed our PI policy with the same competitive excess levels as previously and with a premium increase that is much lower than the rest of the market. This is clear evidence of the benefit of being a member of a network that is focused on the quality of business written.”
In April, the FCA announced that broker fees would rise by 8.5 per cent this year.
In November last year, PTFS announced a new fee structure, introduced in February, that was based on quality of business. It says 80 per cent of its members are paying reduced fees as a result of the change.