FSCS Management Expenses Levy Limit 2026/27
Summary
The FCA and PRA have published PS26/4 confirming the FSCS Management Expenses Levy Limit (MELL) for 2026/27 at £112,972,954. The limit covers FSCS's ongoing operating costs including IT, staff, legal, and claims handling expenses, but excludes compensation costs which are levied separately. The limit applies from 1 April 2026 to 31 March 2027.
What changed
The FCA and PRA jointly confirmed the MELL for FSCS for financial year 2026/27 at £112,972,954, effective 1 April 2026 through 31 March 2027. This represents an annual administrative limit-setting exercise for FSCS operating costs. The MELL covers the FSCS's IT, staff, legal, and outsourced and internal claims handling costs, but does not include compensation costs which are levied separately by the FSCS.
FCA authorised firms and PRA authorised firms should note that this policy statement finalises the annual levy limit following the January-February 2026 consultation (CP26/2). No immediate action is required by firms as the FSCS manages levy collection directly. Firms should be aware of the operational cost funding mechanism supporting FSCS functions when budgeting for annual regulatory costs.
Source document (simplified)
PS26/4: Financial Services Compensation Scheme – Management Expenses Levy Limit 2026/27
Consultation opened 13/01/2026 Consultation closed 10/02/2026 Policy Statement published 31/03/2026 31/03/2026
Policy statements First published:
31/03/2026
Last updated: 31/03/2026
We and the Prudential Regulation Authority (PRA) have confirmed the annual Management Expenses Levy Limit (MELL) for the Financial Services Compensation Scheme (FSCS) for the financial year 2026/27 will be £112,972,954.
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Why we are changing the limit
The FCA and PRA are required to set a limit on the total management expenses that the FSCS can levy financial services firms.
The MELL covers the FSCS’s ongoing operating costs and includes the FSCS’s IT, staff, legal and outsourced and internal claims handling costs. It does not include compensation costs, which are levied separately and decided by the FSCS.
Who this is for
- FCA authorised firms
- PRA authorised firms
Background
Setting the right MELL makes sure the FSCS has enough funding to carry out its functions. The MELL applies from 1 April 2026 until 31 March 2027.
For more detail on how the MELL is calculated and the FSCS unlevied reserve, see the policy statement and the FSCS January 2026 budget update.
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Fees and levies CP26/2: Financial Services Compensation Scheme – Management Expenses Levy Limit 2026/27
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