Home Office launches consultation on locally-set licensing fees

The Home Office has launched a consultation on the move from centrally-set to locally-set fees under the Licensing Act 2003.

The consultation, which can be viewed here, seeks views on issues such as:

• whether and under what circumstances licensing authorities should be able to charge different amounts to different types of premises;
• the maximum amount that can be charged;
• the mechanisms that will provide reassurance to fee-payers that fees are being set transparently, at cost, and efficiency encouraged; and
• whether there should be a single national payment date for annual fees.

Home Office Minister Norman Baker, writing in the foreword, said: “As part of our proposals to rebalance the Licensing Act, we…. recognised arguments from some licensing authorities that they face significant deficits in carrying out their licensing functions, given that fee levels have been unchanged since they were set in 2005.

“We could have set fees centrally, but we recognise that costs vary for legitimate reasons in different areas, so that raising fees to recover costs in one area would mean fee payers paying too much in another.”

Baker stressed that locally-set fees could not be used to raise extra revenues, nor were they tools to tackle crime.

“Fees must be based on recovering the costs that licensing authorities incur in carrying out their licensing functions,” he said. “Fee payers need to know that locally-set fees will be set transparently and be based on evidence. However, we do not wish to impose excessive duties or complex processes that will increase the costs of the licensing system for everyone. Therefore, we are seeking views on how to create a proportionate system of fees that follows these principles.”

The minister added that the Government would introduce caps on the level of each fee to reassure fee payers. “We are consulting on the level of each cap. I emphasise that the caps are intended to represent the maximum costs of licensing authorities. They will not be a ‘guide’ to fee levels. Nor should they prevent licensing authorities from recovering legitimate costs.”

The British Beer & Pub Association has, however, criticised the level of proposed caps.

Chief executive Brigid Simmonds said: “While it is right that the Home Office has accepted the principle of a cap on fees, the proposed limits are far too high, and the removal of bands could hit smaller premises hard.

“A pub in Band B, the most typical band, would currently pay £180 per year for their licence, yet the new cap proposed is £740. With such high caps, there is still a real danger that cash-strapped councils will be tempted to hike up fees dramatically, damaging local pubs.”

The Home Secretary was handed the power to prescribe regulations for a locally-set licensing fee regime by the Police Reform and Social Responsibility Act 2011, which amended the 2003 Act.

Fee levels were set centrally in 2005 and have not been revised since.

A copy of the impact assessment can be viewed here. 

The Home Office is also conducting a survey of licensing authority costs in performing each of their functions under the 2003 Act. “The information will be important to us in developing the details of the regime,” the minister said.

The consultation runs until 10 April.