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Guernsey’s Financial Services Commission has today published its annual report and financial statements for 2013. One of the key messages it contains is that overall costs fell by almost £1 million or 7.5% compared to 2012.
During the second half of 2013, the Commission commenced a significant change programme which saw a restructuring of its Supervisory and Policy Divisions. In addition, the Commission established a Conduct Unit to provide more focus on consumer issues such as mis-selling; an Innovations Unit to undertake analysis of some of the more complex financial services ideas which the Commission is asked to license; and a dedicated Enforcement Division. All of this was achieved while reducing overall costs.
Chairman, Cees Schrauwers, acknowledged that the Commission had encountered some turbulence last year but added that “we did take time to carefully reflect upon the concerns and criticisms that were aired last year by both government and industry and to consider how we might most appropriately respond. That has meant, among other things, engaging more effectively with our key stakeholders. That renewed focus has already started to generate some positive outcomes and the Commission is determined to build upon those in the years to come.”
Speaking about the report William Mason, Director General, said “2013 was a challenging year and I would like to pay tribute to our dedicated staff for the manner in which they have embraced the changes that the Commissioners and I have had to implement. Key amongst those changes has been a significant restructuring of our teams and the move towards risk based supervision while at the same time our staff have seen their defined benefits pension scheme closed and were informed that there would be no general pay increase in 2014.”
Notable areas of expenditure which declined steeply in 2013 included ‘Legal and professional fees’ which came in at £631,000 compared to just over £1.5 million in 2012 – a reduction of 58% which was partly attributable to the establishment of an ‘in house’ enforcement team. ‘Other operating expenses’ also decreased by almost 14% to £629,000.
Staff costs, which include salaries, pension, recruitment and training costs, rose by 5%. This was due in part to the establishment of the new Enforcement Division, in part to a pay rise for less senior staff agreed in late 2012 and implemented in January 2013, and in part attributable to recruitment and training.
In relation to the fees which are levied on finance sector firms, a below RPI increase of 2% was applied in 2013. The Commission also confirmed that, other than in respect of certain anomalies, a general increase in fees of 0.3% had been applied for 2014 (0% for those firms in the investment sector).
