Regulatory Authorities (Level of Charges) Bill

Gordon Henderson Excerpts

Friday 13th May 2011 Commons Chamber

[Mr David Nuttall (Bury North) (Con)]

I am grateful for the opportunity to speak briefly in support of a most laudable Bill. I congratulate my hon. Friend the Member for Christchurch (Mr Chope) on bringing the measure before the House this morning. The Regulatory Authorities (Level of Charges) Bill might be referred to more colloquially as the control of stealth taxes Bill, and when it reaches the statute book, as I hope it will, perhaps that is what it will be called.

Most people would see the Bill as right for the times in which we live—often described as an age of austerity. I am grateful to my hon. Friend for raising some of the problems that regulatory authorities cause. Whenever I have conversations with a professional, be it an accountant, a solicitor or an architect, it is not long before we reach the subject of the imposition of fees by regulatory authorities. From my time in practice, I know that a common source of concern was that bodies such as the Law Society or the Solicitors Regulation Authority seemed able to charge what they liked, without any real control over how they arrived at their fees.

For an organisation that is not in the competitive world, it is all too easy to increase the charges they make on those they have under their control, instead of cutting costs. In many cases, people have no choice about where they have to apply for the licence or certificate they need to conduct their business. That is why some measure of control over regulatory bodies is appropriate.

Many people see those bodies as above the law; they seem to operate in a parallel universe, immune from the pressures of the real world where there is a need to control costs and ensure that the prices charged to customers and clients are kept as low as possible. Those pressures do not exist when there is a captive market and people have nowhere else to go.

The problem with regulatory authorities is that in many ways they are a law unto themselves. Their activities rarely attract much attention. People may have to return to professional bodies every year, but in the case of many other bodies it is only every few years. My hon. Friend mentioned passports. Over 10 years, the cost of a passport increased from £17.50 to £77.50, which far exceeded the rate of inflation over that period, but nobody sat down with a calculator to work out whether the fee went up in line with inflation, or massively more than that. Businesses have to cope not only with the regulatory burden imposed by such bodies, but with the financial burden.

I fully accept that the Bill is not the ideal solution. I would prefer the abolition of the regulatory burden in the first place, and although I accept that in many cases regulation is essential, I am pleased that the coalition Government have been making excellent progress in culling the numerous public bodies and quangos. No doubt the Minister will refer to that later. However, despite the Government’s activities in culling quangos, hundreds will still exist, so the Bill is relevant and essential to protect both the public and businesses from excessive fee increases.

We might think that the onset of new technology, and the possibility for individuals and companies to file things online—in some cases, they have no alternative—would have the effect of driving down prices. Of course, we know from the licence fee freeze that has been imposed on the BBC that, when an organisation is told to cut costs rather than increase its licence fee, it can be done. A few years ago, when Companies House was given freedom from the Government, its filing fees actually decreased. I remember how pleased companies were that the filing fee for an annual return, for example, stopped increasing and started decreasing, so it can be done.

[Gordon Henderson (Sittingbourne and Sheppey) (Con)]

My hon. Friend mentions that Companies House almost went into private mode and was able to drive down its costs. Will he consider the fact that some licence fees have increased because they are no longer heavily subsidised by general taxation and because Governments have tried to ensure that licences should be paid for by the people to whom they are issued? That is why prices have gone up.

[Mr Nuttall]

My hon. Friend makes a good point, and I agree with the general thrust of his comments: service users should contribute to the cost of the service that they use. It is right that, for example, solicitors and accountants pay for the costs of their regulatory bodies. People have no difficulty with that, but the problem comes when regulatory bodies, which are answerable to no one other than their own membership, feel that they can impose excessive increases way beyond the inflation rate, rather than considering ways to control their costs. That is particularly important when organisations across the public sector are being asked to live within their means, and that is the Bill’s thrust.

I certainly hope that the Bill receives the overwhelming support of the House this morning. I wish it well in its progress through the House and in another place. I look forward to hearing the Minister’s comments and to seeing the Bill on the statute book in the months to come. I am sure that it will be widely welcomed, not just in the House, but across the country.