Consultation on Licence And Practice Fee Arrangements

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The CLC’s Practice Fee contribution rates, together with the Individual Licence fees and other administration charges are reviewed annually to ensure that revenue collected through these charges is sufficient to cover the forecast expenditure for the next financial year.

Each year in June, CLC regulated practices renew their Professional Indemnity Insurance (PII). As part of this process regulated practices are required to provide turnover figures to the CLC. The turnover declarations are used to calculate the practice fee payable for the next licensing period which runs from November to October.

The Council of the CLC reviews the forecast and proposals prepared by management and if necessary, makes changes to fee rates and/or expenditure to ensure there are sufficient financial resources available to the CLC to deliver its business plan and statutory responsibilities.

The proposed fee rates are then consulted on and interested parties have an opportunity to comment on the fee proposals for the next licensing year.  This document sets out the consultation on fee proposals for the year November 2024 to October 2025.

After considering the responses received and if necessary, amending the proposal, the Council of the CLC will agree an application to be made to the LSB for approval.

Regulatory and administrative fee proposals for 2024 - 25

For the next licensing year beginning on 1 November 2024, the CLC is proposing to make the following changes to the fees charged:

1. 1. Practice Fee rates will be increased by 9% (The last amendment was in 2023 when the fee rate was increased by 9%). This follows several years of fee rate reductions which reduced fee rates by 60% between 2017 and 2022.

1. 1. The OLC Levy cost allocation formula will be changed so that 50% (currently 70%) of the cost is allocated to all regulated practices as a service availability charge. The remaining 50% (currently 30%) of the cost will be allocated to practices as a usage charge based on the number of cases accepted for investigation by the Legal Ombudsman. This is intended to provide a stronger incentive for the small number of firms that generate disproportionate levels of referrals to the Legal Ombudsman to reduce those consumer complaints.

The CLC is proposing that the following fees remain unchanged for the next licensing year:

• •  Compensation Fund Contributions (The contribution rates were last amended in 2020, when they were reduced by 60%).

• • Individual License Fees remain unchanged (last amended in 2010).

• • Administration and application fees (Last amended in 2023).

Why this consultation is important

Because the CLC is funded by the Practices and Individuals that it regulates, it is important that they and other stakeholders have an opportunity to review and comment on the source and application of the funding to ensure the burden on Practices and Individuals is proportionate while ensuring that the organisation has sufficient resources to execute its business plan and statutory objectives to protect consumers and the public interest.