James Hay defends 'clients may pay' FSCS levy note

Tim Sargisson, the managing director of James Hay Partnership, has defended the provider’s decision to tell clients the FSCS levy may be passed to them.

The company wrote directly to SIPP clients last week explaining it may pass on the cost of its £940,000 levy to customers.

Since then, the provider says IFAs have 'expressed concerns' James Hay did not contact advisers before clients, and issues an apology.

Sargisson says: "We believed it was in everyone's interests to let these clients know sooner rather than later.

"We have been pilloried in some quarters for our stance over the levy but we feel this is a little unfair.

"Almost all SIPP providers feel the same as we do and many have already written into their terms and conditions the right to pass on this sort of levy or, for that matter, tax rises such as increases in VAT.

"James Hay has the resources to absorb the recently announced interim levy, but if the next failure is 10 or 20 times the size, are we expected to absorb this as well?"

Sargisson adds James Hay "may have upset IFAs" by writing to clients, but defends the provider further, saying: "We believe that almost all our peers would dearly love to pass on the levy to their clients.

"We live in a cold commercial world and are all in this together."