FSA pays staff pounds 120,000 for car-parking loss

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THE FINANCIAL Services Authority is to pay a total of up to pounds 120,000 to former Personal Investment Authority staff who lose their car-parking spaces when they switch jobs to join the new regulator, it was revealed yesterday.

About 30 staff who were entitled to free car-parking near the PIA's offices in London's Canary Wharf will receive one-off payments, up to a maximum of pounds 4,500, for the loss of their space.

The compensation package, which will be added to staff salaries at the end of January, is based on a pounds 1,500 assumed annual value of the parking space.

Staff are being offered compensation equivalent to three years' assumed benefits, based on when they transferred to the FSA. The minimum payment is likely to be pounds 3,500. The revelation came in a leaked letter to The Independent.

An FSA spokeswoman said yesterday: "We are not paying this money for the sake of it. This is something we are required to do by employment legislation. Some staff at the PIA had car-parking space and it could be argued that it was part of their contractual rights by virtue of `custom and practice'."

She added that it was unlikely that they would be required to pay back any of the money they received if any of the transferring staff were to leave before the three years' assumed loss of benefit was up.

Details of the cash payments to former PIA staff are set to heap further embarrassment on the beleaguered financial regulator before it finally ceases to exist.

Already under attack from MPs' consumer groups for its slow progress in solving the pounds 15bn pensions mis-selling scandal, the PIA faced further condemnation after it was revealed that its chief executive, Colette Bowe, received a compensation package worth pounds 477,000 for the loss of her job last year. Ms Bowe found a senior position at Flemings, a banking and investment group that she used to regulate, shortly after leaving the PIA.

By contrast, other staff who were made redundant received the statutory amount, worth a maximum of about pounds 2,000.