Instruments drawn to the special attention of the House
Court of Protection, Civil Proceedings and Magistrates’ Courts Fees (Amendment) Order 2018 (SI 2018/812)
Date laid: 4 July 2018
Parliamentary procedure: negative
Summary: This instrument reduces a number of fees for court services to a level that more accurately reflects the cost of the service being provided. Most of the fees being amended were last altered in 2014 but some date back to 2007. The changes are expected to reduce Her Majesty’s Court and Tribunal Service’s (HMCTS) fee income by around £9 million per annum. As well as promising more frequent reviews of HMCTS’s fee structure, the Ministry of Justice (MoJ) states its intention to set up a refund scheme, but the debts owed may involve small amounts to a large number of individuals with a risk that an entirely disproportionate level of administration will be required to set the matter right. The House may wish to enquire what the MoJ’s proposals are for handling the refunds effectively.
This Order is drawn to the special attention of the House on the ground that it gives rise to issues of public policy likely to be of interest to the House.
1.This instrument reduces a number of fees for court services to a level that more accurately reflects the cost of the service being provided. Most of the fees being amended were last altered in 2014 at which time the Ministry of Justice (MoJ) believed that they were set at or below full cost recovery levels. The Court of Protection fees were set in 2007 on the basis that they were then below the full cost of those proceedings; that is no longer the case. The changes made by the current Order to set fees at full cost recovery levels are expected to reduce Her Majesty’s Court and Tribunal Service’s fee income by around £9 million per annum.
2.The MoJ helpfully includes an Annex to the EM which compares the old and new fees being changed, but this should be read in conjunction with the Annex to the Impact Assessment (IA) to get a true picture of the issue. For example, the IA states that the current fee for an Appeal under the Licensing Act 2003 is £410 and the estimated actual unit cost is £70, giving a cost recovery rate of 686%, but there are not a large number of cases. The most significant source of overpayment has been Council Tax Liability Orders for which the fee is currently £3 but the unit cost is 50p; these are however high frequency items and are responsible for £7.9 million of the £9 million overcharged.
3.In the EM the MoJ says that the Government will be establishing a refund scheme for those who have been overcharged and full details will be announced in due course. The administration of the refund scheme is likely to be complex since, as well as including just under 30,000 applications for proceedings in the Court of Protection overcharged at £15 a time, it involves millions of proceedings brought by local authorities against local council taxpayers who were in arrears on their council tax, which had been overcharged at £2.50 a time. In respect of the latter, paragraph 10.2 of the EM states that it is understood that local authorities added the fee to the individuals’ arrears of council tax and “the overall impact on local authorities is therefore expected to be minimal”. This appears to miss the point that the debt owed will be to the individual and there is a risk that an entirely disproportionate amount of administration will be required to set the matter right. The House may wish to enquire what the MoJ’s proposals are for handling the refunds effectively.
Conclusion
4.There will, of course, be immediate benefit to local authorities and others from the reduction of fees but the current situation should not have been allowed to arise. We have seen a number of statutory instruments changing the application process for all kinds of services from hard copy to electronic submission and in most cases this significantly reduces processing time and therefore costs. We note that the MoJ states its intention to put in place arrangements to review fees more regularly against cost, and we hope that such reviews will encompass all the fees that the MoJ charges and ensure that they reflect the benefits of increased use of electronic communication.