FSA Special Projects fees - additional info

Just a few bits of additional information from the FSA special project fees for Solvency II

• Focusing IMAP fees on confirmed model applicants only means small internal model applicant companies will obviously suffer the twin agony of losing the industry-wide "subsidy" for model application costs, as well as paying standard non-IMAP fees for 2011/12
• No refunds if anyone withdraws mid year!
• Straight line recovery based on premiums and liabilities
• Any late entrants who try to join the model approval process will be levied
• Difference in FSA costs between provisional and final budget is nearly £5m - is this vast difference due to the number of model application drop-outs (which must be around 20 companies)?
• Some sniping comments from industry in the consultation responses, saying the differences between budget and requirement showed the FSA "had not budgeted effectively", are spending too much, and should give a more detailed cost breakdown.

I guess all of these comments were gathered before the two-tier approach was revealed last month. I suspect some smaller companies would be happy for the FSA to spend some of this underrun and staff ongoing model validation during 2011, rather than go fishing for more consultants!