The British Insurance Brokers’ Association (BIBA) has petitioned the UK Government with the signatures of nearly 7000 of its members to accelerate its review of the UK’s Financial Services Compensation Scheme (FSCS).

BIBA submitted the petition to the Chairman of the All Party Parliamentary Group on Insurance and Financial Services, Jonathan Evans MP, who will formally present it to the House of Commons.

Mr Evans will also apply for an adjournment debate on the subject in the House of Commons in an extra bid to increase pressure on the Government.

A review into the funding of the FSCS was announced by the Financial Services Association (FSA) in late 2009, but was subsequently postponed due to European Union compensation reviews and until a wider review of UK regulation by the UK Government is completed next year.

UK brokers have faced a succession of huge increases in their levies payable to the scheme, due to the mis-selling of payment protection insurance by credit brokers, who are in the same funding pool as general insurance brokers.

BIBA CEO Eric Galbraith wants the funding review completed by April next year, so that general insurance brokers can avoid another increase in their FSCS levies for the 2012/13 financial year.

But FSA Conduct Policy Director Sheila Nicholl told the parliamentary group that it’s unlikely the levy review will be completed in time for brokers to avoid further levy rises.

She says the review is being held up by slow progress on revisions to EU directives which govern financial services compensation schemes.

The time required for consultation and transitional arrangements means it’s unlikely a new funding model could be in place by April next year.

“We don’t want to do a rush job on this – we want this to be sustainable,” she said.