Court and Tribunal Fees - The Government’s response to the consultation on “Alignment of the Fees for Online and Paper Civil Money and Possession Claims”

• United Kingdom

• Financial services disputes and investigations
• Litigation and dispute management

20-04-2021

Background

The consultation paper “Alignment of the Fees for Online and Paper Civil Money and Possession Claims” was published on 20 November 2020. It invited comments on the proposal by the Ministry of Justice for the removal of the online discount applied to issue fees for users of the County Court Business Centre (CCBC), Money Claim Online (MCOL), Possession Claim Online (PCOL), and Online Civil Money Claim (OCMC), and the fee discount and exemption which applies to certain enforcement fees.

The aims of the proposal rested broadly on the need to:

• Help to ensure that courts and tribunals have the necessary resources to deliver their much-needed services
• Ensure that those who can pay a fee, pay the same fee regardless of whether they lodged their claim online or via the paper route
• Simplify the existing fee structure

The Government believes that there is a strong justification for the alignment of the fees for online and paper civil money and possession claims which is expected to make a significant contribution to the Ministry of Justice’s financial plans for 2022–23 and beyond.

The consultation sought views from users of the civil court system, the legal profession, the judiciary, the advice sector, and all those with an interest in the civil courts system. 22 responses to the consultation paper were received and the Government provided it’s response on 8 March 2021.

Summary of the Government's response 

The Government considers proceeding with the proposed alignment of fees is justified on the basis that the cost of running the courts and tribunals service is considerably more than the income it receives from fees.

The Government considers it is right that those court users who can afford to, should contribute more towards the operations of HMCTS. The proposed change would provide much-needed additional income which will be invested back into improving the efficiency and effectiveness of the courts and tribunals service.

The Government acknowledged concerns raised in relation to the quality of the county court bailiff enforcement service. In recognition of those concerns the £77 online fee will not be aligned to the £110 paper one. Instead, a 7.7% inflationary increase backdated to 2016 (when this fee was last amended) will be applied consolidating the online and paper fees to a new level of £83, (see reference fee number 8.1 (Annex A, affected fees) regarding the Warrant of Control process undertaken by County Court Bailiffs for the enforcement of a judgment or order of the County Court or through the County Court, by the issue of a warrant of control against goods except a warrant to enforce payment of a fine) Proposal for reform: Alignment of the Fees for Online and Paper Civil Money and Possession Claims (publishing.service.gov.uk).

The Government also recognised concerns that the fees considered under this proposal bore little resemblance to the cost of the processes to which they relate. However, under the power contained in section 180 of the Anti-social Behaviour, Crime and Policing Act 2014, the Lord Chancellor may set court fees at a level above the cost of the process.

The Government disagreed that the consultation period was too short and insufficient. The consultation principles set out by the Cabinet Office state that a consultation should last a proportionate amount of time, taking into account the nature and impact of the proposal. In light of this, the Ministry of Justice ran a 6-week consultation.

The Government does not accept that the proposed alignment would inhibit access to justice as research previously undertaken by the Ministry of Justice on this issue has consistently indicated that fees are a secondary consideration in the decision to litigate with the prospects of success and the likelihood of recovering the debt being primary considerations.

Observations

The online process has up to now provided the option for claimants to issue a claim at a reduced cost and to benefit from both the speed and efficiency associated with online processing. Without the reduced fee there is no longer an incentive to use the online option, potentially leading to a decrease in the number of claims issued (according to the government’s impact assessment, a 10% increase in fees would result in a 2.5% reduction in claims). The lack of incentive could also lead to an increase in the use of paper processes which would undoubtedly have an environmental impact. In addition, this does not align with the government’s objective of making savings for the taxpayer because claim numbers are likely to fall and the greater use of paper processes will add to HMCTS administration costs.

It has been reported that significant fee increases, particularly in relation to issue fees, in the past have meant taking legal action, especially on higher value claims, has become too expensive and it deters claimants from commencing court action so in effect deterring them from exercising their legal rights. The fee increase for online claims may exacerbate this situation. Whilst some claimants who receive benefits, on low incomes, may be able to receive government assistance, eligibility depends on their financial circumstances. Those who do not meet the threshold and do not qualify will now be faced with having to either pay an even higher fee or not legally pursuing their claim.

The Government estimates these changes will deliver an additional £12-33m from 2022/23 which will contribute to the costs of funding HMCTS and help deliver efficiencies across the court and tribunal system. Any service improvements would certainly be welcome but there are concerns that the additional revenue will not translate to meaningful change.

Conclusion and next steps

The Government does not believe that the proposed alignment of fees would be a barrier to access to justice and prevent people from bringing proceedings. They do recognise that some litigants may reconsider whether they wish to pursue litigation in light of the cost and the prospects of success but believe that the proposals will contribute towards an effective and properly funded courts and tribunals system.

With the exception of Fee 8.1 (the warrant of Control process explained above), all the remaining fees under the proposal will be aligned to their correspondent paper level as set out in the consultation.

The Government will now prepare the necessary legislation with a view to the new fees coming into effect in May 2021, subject to Parliamentary time being made available.

The above is intended to provide a brief overview of the Governments full and detailed response to the consultation on “Alignment of the Fees for Online and Paper Civil Money and Possession Claims”. For the full response please visit https://www.gov.uk/government/consultations/alignment-of-the-fees-for-online-and-paper-civil-money-and-possession-claims

For more information, please contact: