Regulators propose reduced cost of renewal
Costs are set to fall for solicitors in October as the practising certificate (PC) fee is frozen for a third consecutive year alongside a lower rate of contribution to the Compensation Fund.
Costs are set to fall for solicitors in October as the practising certificate (PC) fee is frozen for a third consecutive year alongside a lower rate of contribution to the Compensation Fund.
The Law Society has proposed that the PC remains at a cost of £278, which includes levies for the Solicitors Disciplinary Tribunal, the Legal Services Board, the Financial Conduct Authority and the Legal Ombudsman.
The fee also covers the costs of the regulation work undertaken by the Solicitors Regulation Authority (SRA). The proposed fee is currently open to consultation, the results of which will be considered at the Law Society’s Annual General Meeting on 4 July 2019.
If approved the fee will go to the LSB for final approval. Law Society president Christina Blacklaws said: “The Law Society is becoming ever more efficient. The PC fee has decreased by almost one fifth in real terms since April 2015.”
The PC fee does not contribute to the Compensation Fund, which pays out to clients that have suffered financial hardship due to a solicitor’s negligence. As of the next practising year, the SRA has proposed that contributions to the fund fall. The individual contribution for 2019/20 will be £60, reduced from £90. Firms’ contributions will be £1,150, a reduction of £530 from £1,680.
Again, the figures are subject to final approval by the SRA Board and LSB. The SRA has attributed the reduced cost to a decline in the number and complexity of interventions.
SRA chief executive Paul Philip said: “We have to make sure there are enough funds to cover potential claims, both on current applications and those we expect to receive. The two year on year rises in contribution reflected forecasts of potentially significant increases in claim values on the Fund, especially from involvement in investment schemes.
“With fewer than expected interventions over the last year or so, I am pleased that we have now been able to bring contributions down.” Compensation Fund contributions are collected in October as part of the annual renewals process.