Draft Non-Contentious Probate (Fees) Order 2018

Debate between Lucy Frazer and Susan Elan Jones

Thursday 7th February 2019 General Committees

[The Parliamentary Under-Secretary of State for Justice (Lucy Frazer)]

I beg to move,

That the Committee has considered the draft Non-Contentious Probate (Fees) Order 2018.

It is a pleasure, as always, to serve under your chairmanship, Mr Gray. The purpose of the draft order is to implement a new, more progressive banded structure of fees for the grant of representation, commonly known as a grant of probate, which will come into force in April. The banded fees relate to the value of the estate. Let me outline how I intend to structure my remarks. I will talk about what the probate is, what the old regime was, what the new structure will be and the reasons we are bringing it in, and then I will deal with some concerns that have been raised.

Probate is an important service that provides valuable support to those who are bereaved. It is administered by Her Majesty’s Courts and Tribunals Service. It helps to ensure that the estate of a deceased person is passed on to the rightful beneficiaries. Under the old scheme, there was a charge of £155 for grant applications made by solicitors and a charge of £215 for those made by individuals. Those were flat fees that applied to estates worth more than £5,000, and they were set at cost recovery levels.

The new structure is different. It is a banded, fairer structure for probate fees and it no longer applies a flat fee. The threshold at which the new fees become payable will be raised from £5,000 to £50,000. That will exempt approximately 25,000 additional estates per year from paying fees altogether. Overall, more than half of estates will pay nothing, because they are either exempt or do not require a grant of probate. Of those that do pay, around 60% will pay fees of £250, which is comparable to the current fee for individual applications. Moreover, the new model means that revised fees will never amount to more than 0.5% of the value of the estate.

The previous Government initially announced plans to introduce enhanced probate fees from February 2017, following a public consultation. The relevant draft affirmative statutory instrument was laid in Parliament, and the order was debated and passed by a Commons Delegated Legislation Committee in April. The announcement of a general election, however, meant that there was not time for the order to be debated and considered for approval in both Houses.

The Government have looked closely at the various criticisms that were made of the previous order. The top band has now been reduced from £20,000 under the previous proposal to £6,000 under this order. The new banded fees structure does not amend the underlying policy rationale and will retain the same progressive banded structure as the earlier proposal, in which the fee payable relates to the value of the estate.

[Susan Elan Jones (Clwyd South) (Lab)]

I know that the Government are taking the issue of charities and legacies very seriously in the light of research from the Office for Civil Society. Does the Minister agree that there are serious concerns in the voluntary sector? I was reading a submission from the Institute of Fundraising only this morning. When a charity such as Cancer Research UK fears that the changes could cost it £600 million per year, it highlights the real concerns of organisations in the voluntary sector. Does she agree that we should consider having further discussions, as the Institute of Fundraising has suggested?

[Lucy Frazer]

Of course, the charity sector plays a vital role in supporting those in need. The order will not affect the amount paid out to charities when there is a fixed bequest rather than a percentage, but I understand the hon. Lady’s concerns.