The cost of the Financial Conduct Authority’s “voluntary resignation programme” has surged to over £7m compared to just £200,000 last year.
The watchdog’s figures, published in its annual report for the year to April, showed the jump, in the number of staff who took advantage of its “Mutually Agreed Resignation Scheme” (MARS) in the year to April, was almost 35 times that of 2020.
The watchdog is currently undergoing a rapid transformation programme under new boss Nikhil Rathi, as it seeks to become a more nimble and agile regulator.
Insiders at the FCA have told City A.M. that the organisation wants to be both faster to spot bad behaviour and be more forward-thinking on regulation to allow innovative new financial firms to thrive in the capital.
In total the FCA spent £7.6m on 104 staff exit packages in the year to April 2021, compared to £0.6m for 21 departures in the previous year.
The figures include compulsory redundancies, long-term ill health settlements and “other departures agreed”, which the MARS settlement comes under, and which saw the highest number of settlements.
The MARS scheme, the FCA said in its report, is not a redundancy scheme – although the severance payment is equivalent to what the FCA would pay for a redunancy.
A source close to the matter said that the £7m related to MARS settlement payments is being paid out currently.
In the FCA’s annual report, the regulator said it had opted to run the scheme in the 2020/21 financial year to give “eligible colleagues the opportunity to apply to resign from the FCA with a severance payment”.
The regulator said, in its report, that severance packages had been calculated according to “base salary, age and length of service and capped at £100,000.”