A review was originally announced in July 2009 and a consultation paper was due to be published in late 2010, but the regulator suspended its investigation last November.

The cost of the attempted review was revealed in response to a Freedom of Information request from Mortgage Solutions’ sister title Insurance Age.

In answer to the request, the FSA said it postponed its own review because “the government’s decision to review the structure of the FSCS and proposals to amend European compensation scheme directives meant that formal consultation could not begin until we had clarity about these issues.

“The review is therefore expected to be completed later this year”.

A spokesperson for the FSA said work done on the postponed review will  provide “a basis for future consultation on the funding of the FSCS”.

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She added it has also supported the UK’s technical input into the European debate on funding compensation schemes.

“We will formally consult when these issues have been clarified,” she said.

However, MPs who back advisers’ calls for a speedy review of FSCS funding have said they will take the fight to Treasury Secretary Mark Hoban, after the FSA last night refused to commit to an April 2012 deadline for the overhaul.