Trade bodies urge Government not to introduce 'complex and unfair' changes to licence fees

09-Apr-2014 - Last updated on 11-Apr-2014 at 13:33 GMT

The consultation on whether licence fees should be set locally ends today

Trade bodies have warned that the Government's proposed changes to licence fees could result in ‘increased costs and complexity for both operators and local authorities’.

The Home Office consultation, Fees Under the Licensing Act 2003 – which closes today, has been inviting views from licensing authorities and fee paying licensees in a bid to cut red tape for businesses.

Proposals centre on three main areas: the maximum amounts that can be charged; whether and under what circumstances different amounts should be charged to different types of premises; and the mechanisms that will reassure fee-payers that the prices are being set transparently and at a cost.

However, in a written submission, the Association of Licensed Multiple Retailers (ALMR) called for a ‘proportionate, transparent and evidence-based regime’, ‘retention of the current rateable system’ and insisted upon a ‘common sense approach’ to costing.

Concerns

“While we applaud the Government’s efforts to cut red tape for responsible businesses and promote transparency, we are concerned that, not only will the proposals not deliver against these objectives, they will increase costs and complexity for both operators and local authorities,” Kate Nicholls, ALMR’s strategic affairs director, said.

“Replacing the current rateable scheme, which is perceived to be fair, with a complex system which unfairly taxes pubs and bars at the expense of supermarkets, serves only to increase red tape and administrative costs for local authorities. This inevitably causes fees to rise and there is a risk that these increased fees will be used to cover inflated administrative costs rather than being used for effective compliance, which is helpful to no one.”

Nicholls warned that the removal of the rateable value bandings within the fee levels could result in smaller businesses facing ‘exorbitant increases’ and declared that premises currently in Band B could see their application and variation fees rise by up to 1,000% and their annual fees by 300% which would be unsustainable.

Complicated

In addition, Nicholls said the Government was basing much of its evidence for the consultation on research carried out over eight years ago and proposing an ‘infinitely more complicated system’.

“Complexities in the regime, particularly those which call for interpretation, are likely to lead to increased instances of disagreement and legal challenges,” she warned. “The current system of rateable value works and there is no question that its structure should be retained in any future regime.”

The British Beer and Pub Association also voiced its objections.The BBPA has put forward an alternative solution, which would see an element of locally set fees but with the rateable value fee bandings remaining as at present. The BBPA’s system would be subject to a cap across each fee band based on inflationary increases since 2005, which it says would retain proportionality between the fee bandings and ensure that smaller pubs will not see disproportionate fee rises.

Chief executive Brigid Simmonds said: “The Government’s proposals could see massive rises in fees for pubs, simply to open their doors. While a cap on fees is right in principle, the proposed limits are far too high. It might prove tempting for some local councils to hike fees dramatically, and the removal of bands would hit smaller pubs very hard.

“Given the huge concerns I hope the Government reconsiders, and takes a close look at our alternative proposals.”