As the summer festival season gets underway, councils are warning
that because of outdated licensing fees, local taxpayers are
heavily subsidising some commercial events and are calling for
fees to be updated – a plea that extends across the whole
licensed sector.
The Local Government Association, which represents councils in
England and Wales, is calling for Government to enable councils
to set licensing fees at a level that recovers the full costs of
administering the work for each event and premises.
Under the Licensing Act 2003, councils are responsible for
granting licences for premises providing entertainment and
alcohol, and for some sporting and other events. Councils are
able to charge a set licence fee intended to cover the cost of
issuing, administering, and enforcing these licences.
Since the Act’s introduction in 2005, national fees set by
central government have not been updated.
This is despite an independent report in 2006 recommending that
fees should initially be increased by 7 per cent to alleviate
funding gaps.
Updated analysis led by the LGA in 2016 revealed that licensing
authorities had a net deficit of £10.3 million in licensing fees,
a figure which will have since increased as inflation causes
overall costs to rise.
Councils are highlighting how licence fees for some events often
incur the biggest cost shortfalls, with some festivals –
attracting up to 5,000 paying attendees – paying councils just
£100 for a licence to host the event. This is despite these types
of events taking a significant amount of council time to manage,
from site visits and resident engagement to address concerns, to
setting and enforcing the conditions and safety requirements for
how they should operate.
The LGA wants councils to be given the power to set fees locally,
as a House of Lords select committee also recommended in 2017.
Deputy Chair of the LGA’s Safer and Stronger Communities Board,
Cllr Clive Woodbridge, said: “Councils want to support their
local culture offer and ensure their towns and areas are
attractive destinations to host events and licensed premises.
“However, the Government has underestimated the costs councils
incur in administering the Licensing Act for more than 15 years.
With councils facing ever increasing budget pressures, there is a
dire need for fees to be updated to fairly reflect current
administrative costs.
“Councils should be allowed to set local fees which will enable
them to charge appropriately for each event. At the very least,
we urge government to recognise the need for an uplift and commit
to a flat rate increase to the 2005 fee levels.
“Setting fees at local cost recovery level will not impact the
viability of businesses and events because they are not a
significant proportion of overall operating costs but will ensure
that councils are reimbursed for the costs they incur and stop
taxpayers subsidising licensed businesses and commercial events.”
Case Studies
Herefordshire Council received a premises
licence application for a three-day outdoor festival catering for
up to 5,000 attendees. The organiser paid a £100 licence fee,
however the estimated cost of awarding the licence is upwards of
£1,500 due to the resource requirements to address resident
concerns and ensure the event complied with a range of mandatory
regulations.
Cannock Chase DC recently received an
application for a micro pub and neighbourhood bar, which
attracted more than 60 representations from residents and others
and resulted in a half-day hearing of the Licensing
Sub-Committee, in addition to the time it took to receive and
process the application. The council received just £190 towards
the cost of this.
Leeds City Council faces significant shortfalls
in costs when licensing different events due to nationally set
fees that do not reflect the individual licensing requirements
for each event. Event organisers currently must pay a £100 fee to
set up a new licence, followed by an annual fee to maintain the
events licence, based on the non-domestic rateable value of the
space. With most events held on land that doesn’t have a rateable
value, the council can only charge the lowest band - £70.
Organisers may also be charged a large event fee based on the
occupancy of the event. However, the large event fee does not
apply for events catering for up to 4,999 people, despite many of
these events often requiring as much licensing support as a
bigger event would, costing the council hundreds of pounds to
administer duties and a funding gap to account for.
Ends.
Notes To Editors –
- Licensing fees are not permitted to generate income for
councils.
-
Report – 2006
Independent panel review of fees
-
2016 LGA analysis
-
House of Lord report –
2017
