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<br /> Financial Services Compensation Scheme<br /> Annual Report and Accounts<br /> 2017/18<br /> HC 1204i<br /> <br /> Financial Services Compensation Scheme<br /> Annual Report and Accounts<br /> 2017/18<br /> 3<br /> Presented to the House of Commons pursuant to Section 7 of the<br /> Government Resources and Accounts Act 2000<br /> Ordered by the House of Commons to be printed on 28 June 2018<br /> HC 1204i part i of ii<br /> An accompanying Financial Services Compensation Scheme Annual Report<br /> and Class Statements (part ii) was also presented to the House of Commons<br /> on 28 June 2018<br /> FSCS Annual Report and Accounts 2017/18<br /> !<br /> © Crown copyright 2018<br /> This publication is licensed under the terms of the Open Government Licence<br /> v3.0 except where otherwise stated. To view this licence, visit<br /> nationalarchives.gov.uk/doc/open-government-licence/ve<a title="FSCS Annual Report 2017-18 page 1" href="https://secure.viewer.zmags.com/publication/940185ab?page=1"> Financial Services Compensation Scheme Annual Rep</a> <a title="FSCS Annual Report 2017-18 page 2" href="https://secure.viewer.zmags.com/publication/940185ab?page=2"> </a> <a title="FSCS Annual Report 2017-18 page 3" href="https://secure.viewer.zmags.com/publication/940185ab?page=3"> Financial Services Compensation Scheme Annual Rep</a> <a title="FSCS Annual Report 2017-18 page 4" href="https://secure.viewer.zmags.com/publication/940185ab?page=4"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 5" href="https://secure.viewer.zmags.com/publication/940185ab?page=5"> CONTENTS Business Highlights </a> <a title="FSCS Annual Report 2017-18 page 6" href="https://secure.viewer.zmags.com/publication/940185ab?page=6"> FSCS Annual Report and Accounts 2017/18 BUSINE</a> <a title="FSCS Annual Report 2017-18 page 7" href="https://secure.viewer.zmags.com/publication/940185ab?page=7"> Paid Paid £405m compensation to help customers g</a> <a title="FSCS Annual Report 2017-18 page 8" href="https://secure.viewer.zmags.com/publication/940185ab?page=8"> OUR MISSION AND ROLE The mission of the Financ</a> <a title="FSCS Annual Report 2017-18 page 9" href="https://secure.viewer.zmags.com/publication/940185ab?page=9"> Our Mission and Role </a> <a title="FSCS Annual Report 2017-18 page 10" href="https://secure.viewer.zmags.com/publication/940185ab?page=10"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 11" href="https://secure.viewer.zmags.com/publication/940185ab?page=11"> Our Mission and Role Relationship with </a> <a title="FSCS Annual Report 2017-18 page 12" href="https://secure.viewer.zmags.com/publication/940185ab?page=12"> 12</a> <a title="FSCS Annual Report 2017-18 page 13" href="https://secure.viewer.zmags.com/publication/940185ab?page=13"> 01 Chairman’s Statement 01 CHAIRMAN’S STATEMEN</a> <a title="FSCS Annual Report 2017-18 page 14" href="https://secure.viewer.zmags.com/publication/940185ab?page=14"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 15" href="https://secure.viewer.zmags.com/publication/940185ab?page=15"> 01 Chairman’s Statement us most. Our pe</a> <a title="FSCS Annual Report 2017-18 page 16" href="https://secure.viewer.zmags.com/publication/940185ab?page=16"> 16</a> <a title="FSCS Annual Report 2017-18 page 17" href="https://secure.viewer.zmags.com/publication/940185ab?page=17"> 02 Chief Executive’s Review 02 CHIEF EXECUTIVE</a> <a title="FSCS Annual Report 2017-18 page 18" href="https://secure.viewer.zmags.com/publication/940185ab?page=18"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 19" href="https://secure.viewer.zmags.com/publication/940185ab?page=19"> Our preparedness Our investments and partnerships</a> <a title="FSCS Annual Report 2017-18 page 20" href="https://secure.viewer.zmags.com/publication/940185ab?page=20"> 20</a> <a title="FSCS Annual Report 2017-18 page 21" href="https://secure.viewer.zmags.com/publication/940185ab?page=21"> 03 Strategic and Performance Report 03 STRATEG</a> <a title="FSCS Annual Report 2017-18 page 22" href="https://secure.viewer.zmags.com/publication/940185ab?page=22"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 23" href="https://secure.viewer.zmags.com/publication/940185ab?page=23"> 03 Strategic and Performance Report Our imperat</a> <a title="FSCS Annual Report 2017-18 page 24" href="https://secure.viewer.zmags.com/publication/940185ab?page=24"> FSCS Annual Report and Accounts 2017/18 Impera</a> <a title="FSCS Annual Report 2017-18 page 25" href="https://secure.viewer.zmags.com/publication/940185ab?page=25"> 03 Strategic and Performance Report </a> <a title="FSCS Annual Report 2017-18 page 26" href="https://secure.viewer.zmags.com/publication/940185ab?page=26"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 27" href="https://secure.viewer.zmags.com/publication/940185ab?page=27"> 03 Strategic and Performance Report DE</a> <a title="FSCS Annual Report 2017-18 page 28" href="https://secure.viewer.zmags.com/publication/940185ab?page=28"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 29" href="https://secure.viewer.zmags.com/publication/940185ab?page=29"> Satisfaction at decision stage is, unsurprisingly</a> <a title="FSCS Annual Report 2017-18 page 30" href="https://secure.viewer.zmags.com/publication/940185ab?page=30"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 31" href="https://secure.viewer.zmags.com/publication/940185ab?page=31"> Of those who do not know if their reti</a> <a title="FSCS Annual Report 2017-18 page 32" href="https://secure.viewer.zmags.com/publication/940185ab?page=32"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 33" href="https://secure.viewer.zmags.com/publication/940185ab?page=33"> made to us were being submitted online. This repr</a> <a title="FSCS Annual Report 2017-18 page 34" href="https://secure.viewer.zmags.com/publication/940185ab?page=34"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 35" href="https://secure.viewer.zmags.com/publication/940185ab?page=35"> 03 Strategic and Performance Report Comp</a> <a title="FSCS Annual Report 2017-18 page 36" href="https://secure.viewer.zmags.com/publication/940185ab?page=36"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 37" href="https://secure.viewer.zmags.com/publication/940185ab?page=37"> Life & Pensions Intermediation (SC02) Life and Pe</a> <a title="FSCS Annual Report 2017-18 page 38" href="https://secure.viewer.zmags.com/publication/940185ab?page=38"> FSCS Annual Report and Accounts 2017/18 I</a> <a title="FSCS Annual Report 2017-18 page 39" href="https://secure.viewer.zmags.com/publication/940185ab?page=39"> General Insurance Provision (SB01) General Insura</a> <a title="FSCS Annual Report 2017-18 page 40" href="https://secure.viewer.zmags.com/publication/940185ab?page=40"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 41" href="https://secure.viewer.zmags.com/publication/940185ab?page=41"> FSCS has documented and agreed contingency plans,</a> <a title="FSCS Annual Report 2017-18 page 42" href="https://secure.viewer.zmags.com/publication/940185ab?page=42"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 43" href="https://secure.viewer.zmags.com/publication/940185ab?page=43"> 03 Strategic and Performance Report </a> <a title="FSCS Annual Report 2017-18 page 44" href="https://secure.viewer.zmags.com/publication/940185ab?page=44"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 45" href="https://secure.viewer.zmags.com/publication/940185ab?page=45"> 03 Strategic and Performance Report Ove</a> <a title="FSCS Annual Report 2017-18 page 46" href="https://secure.viewer.zmags.com/publication/940185ab?page=46"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 47" href="https://secure.viewer.zmags.com/publication/940185ab?page=47"> Diversity and inclusion FSCS employee numbers by </a> <a title="FSCS Annual Report 2017-18 page 48" href="https://secure.viewer.zmags.com/publication/940185ab?page=48"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 49" href="https://secure.viewer.zmags.com/publication/940185ab?page=49"> 03 Strategic and Performance Report FI</a> <a title="FSCS Annual Report 2017-18 page 50" href="https://secure.viewer.zmags.com/publication/940185ab?page=50"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 51" href="https://secure.viewer.zmags.com/publication/940185ab?page=51"> Compensation costs The rise in compensation costs</a> <a title="FSCS Annual Report 2017-18 page 52" href="https://secure.viewer.zmags.com/publication/940185ab?page=52"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 53" href="https://secure.viewer.zmags.com/publication/940185ab?page=53"> Compensation payments The total value of compensa</a> <a title="FSCS Annual Report 2017-18 page 54" href="https://secure.viewer.zmags.com/publication/940185ab?page=54"> 54</a> <a title="FSCS Annual Report 2017-18 page 55" href="https://secure.viewer.zmags.com/publication/940185ab?page=55"> 04 Annual Report of the Independent Investigator </a> <a title="FSCS Annual Report 2017-18 page 56" href="https://secure.viewer.zmags.com/publication/940185ab?page=56"> 56</a> <a title="FSCS Annual Report 2017-18 page 57" href="https://secure.viewer.zmags.com/publication/940185ab?page=57"> 05 Accountability Report 05 ACCOUNTABILITY REP</a> <a title="FSCS Annual Report 2017-18 page 58" href="https://secure.viewer.zmags.com/publication/940185ab?page=58"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 59" href="https://secure.viewer.zmags.com/publication/940185ab?page=59"> Deputy Chairman and Senior Independent Director M</a> <a title="FSCS Annual Report 2017-18 page 60" href="https://secure.viewer.zmags.com/publication/940185ab?page=60"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 61" href="https://secure.viewer.zmags.com/publication/940185ab?page=61"> 05 Accountability Report Committees of </a> <a title="FSCS Annual Report 2017-18 page 62" href="https://secure.viewer.zmags.com/publication/940185ab?page=62"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 63" href="https://secure.viewer.zmags.com/publication/940185ab?page=63"> External audit The Committee: • reviewed the ext</a> <a title="FSCS Annual Report 2017-18 page 64" href="https://secure.viewer.zmags.com/publication/940185ab?page=64"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 65" href="https://secure.viewer.zmags.com/publication/940185ab?page=65"> What the Committee has done The Committee: • rec</a> <a title="FSCS Annual Report 2017-18 page 66" href="https://secure.viewer.zmags.com/publication/940185ab?page=66"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 67" href="https://secure.viewer.zmags.com/publication/940185ab?page=67"> 05 Accountability Report </a> <a title="FSCS Annual Report 2017-18 page 68" href="https://secure.viewer.zmags.com/publication/940185ab?page=68"> FSCS Annual Report and Accounts 2017/18 THE BO</a> <a title="FSCS Annual Report 2017-18 page 69" href="https://secure.viewer.zmags.com/publication/940185ab?page=69"> Jimmy Barber (Chief Operating Officer)  Jimmy joi</a> <a title="FSCS Annual Report 2017-18 page 70" href="https://secure.viewer.zmags.com/publication/940185ab?page=70"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 71" href="https://secure.viewer.zmags.com/publication/940185ab?page=71"> Charles McKenna Charles has a background in law a</a> <a title="FSCS Annual Report 2017-18 page 72" href="https://secure.viewer.zmags.com/publication/940185ab?page=72"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 73" href="https://secure.viewer.zmags.com/publication/940185ab?page=73"> 05 Accountability Report </a> <a title="FSCS Annual Report 2017-18 page 74" href="https://secure.viewer.zmags.com/publication/940185ab?page=74"> FSCS Annual Report and Accounts 2017/18 DIRECT</a> <a title="FSCS Annual Report 2017-18 page 75" href="https://secure.viewer.zmags.com/publication/940185ab?page=75"> 2016/17 Taxable benefits2 £’000 (nearest £100) Pe</a> <a title="FSCS Annual Report 2017-18 page 76" href="https://secure.viewer.zmags.com/publication/940185ab?page=76"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 77" href="https://secure.viewer.zmags.com/publication/940185ab?page=77"> certain shortage areas, although this did not pre</a> <a title="FSCS Annual Report 2017-18 page 78" href="https://secure.viewer.zmags.com/publication/940185ab?page=78"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 79" href="https://secure.viewer.zmags.com/publication/940185ab?page=79"> 05 Accountability Report </a> <a title="FSCS Annual Report 2017-18 page 80" href="https://secure.viewer.zmags.com/publication/940185ab?page=80"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 81" href="https://secure.viewer.zmags.com/publication/940185ab?page=81"> Risk Management Framework First line</a> <a title="FSCS Annual Report 2017-18 page 82" href="https://secure.viewer.zmags.com/publication/940185ab?page=82"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 83" href="https://secure.viewer.zmags.com/publication/940185ab?page=83"> 05 Accountability Report Principal Risk</a> <a title="FSCS Annual Report 2017-18 page 84" href="https://secure.viewer.zmags.com/publication/940185ab?page=84"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 85" href="https://secure.viewer.zmags.com/publication/940185ab?page=85"> Risk Profile in 2017/18, including emerging risks</a> <a title="FSCS Annual Report 2017-18 page 86" href="https://secure.viewer.zmags.com/publication/940185ab?page=86"> FSCS Annual Report and Accounts 2017/18 DIRECT</a> <a title="FSCS Annual Report 2017-18 page 87" href="https://secure.viewer.zmags.com/publication/940185ab?page=87"> Statement of directors’ responsibilities in respe</a> <a title="FSCS Annual Report 2017-18 page 88" href="https://secure.viewer.zmags.com/publication/940185ab?page=88"> 88</a> <a title="FSCS Annual Report 2017-18 page 89" href="https://secure.viewer.zmags.com/publication/940185ab?page=89"> 06 Auditor’s Report 06 AUDITOR’S REPORT THE </a> <a title="FSCS Annual Report 2017-18 page 90" href="https://secure.viewer.zmags.com/publication/940185ab?page=90"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 91" href="https://secure.viewer.zmags.com/publication/940185ab?page=91"> 06 Auditor’s Report Key audit matter 2 </a> <a title="FSCS Annual Report 2017-18 page 92" href="https://secure.viewer.zmags.com/publication/940185ab?page=92"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 93" href="https://secure.viewer.zmags.com/publication/940185ab?page=93"> • evaluate the overall presentation, structure an</a> <a title="FSCS Annual Report 2017-18 page 94" href="https://secure.viewer.zmags.com/publication/940185ab?page=94"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 95" href="https://secure.viewer.zmags.com/publication/940185ab?page=95"> 06 Auditor’s Report MATTERS ON WHICH I </a> <a title="FSCS Annual Report 2017-18 page 96" href="https://secure.viewer.zmags.com/publication/940185ab?page=96"> </a> <a title="FSCS Annual Report 2017-18 page 97" href="https://secure.viewer.zmags.com/publication/940185ab?page=97"> 07 Financial Statements and Notes 07 FINANCIAL</a> <a title="FSCS Annual Report 2017-18 page 98" href="https://secure.viewer.zmags.com/publication/940185ab?page=98"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 99" href="https://secure.viewer.zmags.com/publication/940185ab?page=99"> 07 Financial Statements and Notes Statem</a> <a title="FSCS Annual Report 2017-18 page 100" href="https://secure.viewer.zmags.com/publication/940185ab?page=100"> FSCS Annual Report and Accounts 2017/18 Notes t</a> <a title="FSCS Annual Report 2017-18 page 101" href="https://secure.viewer.zmags.com/publication/940185ab?page=101"> 07 Financial Statements and Notes Any d</a> <a title="FSCS Annual Report 2017-18 page 102" href="https://secure.viewer.zmags.com/publication/940185ab?page=102"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 103" href="https://secure.viewer.zmags.com/publication/940185ab?page=103"> 07 Financial Statements and Notes k) Pen</a> <a title="FSCS Annual Report 2017-18 page 104" href="https://secure.viewer.zmags.com/publication/940185ab?page=104"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 105" href="https://secure.viewer.zmags.com/publication/940185ab?page=105"> 07 Financial Statements and Notes 6 Comp</a> <a title="FSCS Annual Report 2017-18 page 106" href="https://secure.viewer.zmags.com/publication/940185ab?page=106"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 107" href="https://secure.viewer.zmags.com/publication/940185ab?page=107"> 07 Financial Statements and Notes 9 Staf</a> <a title="FSCS Annual Report 2017-18 page 108" href="https://secure.viewer.zmags.com/publication/940185ab?page=108"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 109" href="https://secure.viewer.zmags.com/publication/940185ab?page=109"> 07 Financial Statements and Notes 11 Rec</a> <a title="FSCS Annual Report 2017-18 page 110" href="https://secure.viewer.zmags.com/publication/940185ab?page=110"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 111" href="https://secure.viewer.zmags.com/publication/940185ab?page=111"> 07 Financial Statements and Notes The m</a> <a title="FSCS Annual Report 2017-18 page 112" href="https://secure.viewer.zmags.com/publication/940185ab?page=112"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 113" href="https://secure.viewer.zmags.com/publication/940185ab?page=113"> 07 Financial Statements and Notes 12 Cas</a> <a title="FSCS Annual Report 2017-18 page 114" href="https://secure.viewer.zmags.com/publication/940185ab?page=114"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 115" href="https://secure.viewer.zmags.com/publication/940185ab?page=115"> 07 Financial Statements and Notes Non-c</a> <a title="FSCS Annual Report 2017-18 page 116" href="https://secure.viewer.zmags.com/publication/940185ab?page=116"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 117" href="https://secure.viewer.zmags.com/publication/940185ab?page=117"> 07 Financial Statements and Notes PRINCI</a> <a title="FSCS Annual Report 2017-18 page 118" href="https://secure.viewer.zmags.com/publication/940185ab?page=118"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 119" href="https://secure.viewer.zmags.com/publication/940185ab?page=119"> 07 Financial Statements and Notes 16 Fin</a> <a title="FSCS Annual Report 2017-18 page 120" href="https://secure.viewer.zmags.com/publication/940185ab?page=120"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 121" href="https://secure.viewer.zmags.com/publication/940185ab?page=121"> 07 Financial Statements and Notes 17 Rec</a> <a title="FSCS Annual Report 2017-18 page 122" href="https://secure.viewer.zmags.com/publication/940185ab?page=122"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 123" href="https://secure.viewer.zmags.com/publication/940185ab?page=123"> 07 Financial Statements and Notes For t</a> <a title="FSCS Annual Report 2017-18 page 124" href="https://secure.viewer.zmags.com/publication/940185ab?page=124"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 125" href="https://secure.viewer.zmags.com/publication/940185ab?page=125"> 07 Financial Statements and Notes SENSIT</a> <a title="FSCS Annual Report 2017-18 page 126" href="https://secure.viewer.zmags.com/publication/940185ab?page=126"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 127" href="https://secure.viewer.zmags.com/publication/940185ab?page=127"> 07 Financial Statements and Notes £’000</a> <a title="FSCS Annual Report 2017-18 page 128" href="https://secure.viewer.zmags.com/publication/940185ab?page=128"> FSCS Annual Report and Accounts 2017/18 </a> <a title="FSCS Annual Report 2017-18 page 129" href="https://secure.viewer.zmags.com/publication/940185ab?page=129"> </a> <a title="FSCS Annual Report 2017-18 page 130" href="https://secure.viewer.zmags.com/publication/940185ab?page=130"> By phone on: 0800 678 1100 or 020 7741 4100 Line</a>