Recommendation 15

The FCA provides guidance on how compensation should be calculated and sets the rules for how compensation is delivered. Calculations use complex financial assumptions which are updated every three months in accordance with market performance, and therefore are subject to changes in the market which causes significant variation in the amount of compensation delivered to BSPS members. The FCA updated the calculation in 2021 causing members who sought compensation early to receive significantly lower amounts than those who claimed after 2021.49 Similarly, the FCA has imposed limits on the compensation awarded by the FSCS, which is capped at £85,000 for firms that failed after April 2019 and £50,000 for firms that failed before. This further unfairly penalises those who followed the FCA’s guidance and sought compensation early.50 Members are unable to seek further compensation, and many feel they have been treated unfairly because of the timing of their complaint; as described by one former member, the prospect of not getting their rightfully deserved compensation is both un-just and heart-breaking.51