Banks to pay ombudsman more as Treasury crackdown costs £8m

The Financial Ombudsman Service had faced a crackdown in the last year.

Banks will pay more to the Financial Ombudsman Service in the next year as the body strums up cash for its bill to meet the Treasury’s clampdown.

Financial services will pay the FOS £86m in the 2026/27 financial year – an increase of £16m – under new proposals, which aim to beef up the Compulsory Jurisdiction (CJ) levy.

The levy is a mandatory annual charge paid by the financial services industry to the Financial Conduct Authority (FCA) to fund a portion of the Financial Ombudsman Service’s (FOS) costs.

The increase comes in part from inflation but also the expected £8m cost of the FOS’ ‘Modernising Redress’ programme, as part of the Treasury’s promised crackdown on the service.

In her Leeds Reforms package