Competition authority to review probate fees
The controversial new probate fees announced by the government in November have been referred to the Competition and Markets Authority (CMA) by independent financial advisory group LEBC.
LEBC claims that the dramatic increase in fees would cause ‘hardship and distress’ to the bereaved.
The new sliding scale of fees starts at a figure of £250 for estates of £50,000, rising to £6,000 for those in excess of £2m. In some cases, where cash is unavailable, it is unclear where the executors will find the funds for the additional cost.
Last week, a House of Commons legislative committee voted by nine votes to eight to approve the new charges. It is likely to be passed by the House of Commons, meaning it would be in force by April.
The House of Lords opposes the new fees, as do several charities and the Law Society, who called them ‘a misuse of the Lord Chancellor’s fee-levying powers.’
LEBC’s Director of Public Policy, Kay Ingram, said: “The CMA has shone a light on poor treatment of the bereaved in the field of funeral services and care homes. If, as the MoJ argues, this increase is not a tax increase, but a fee, then it deserves the same scrutiny as exploitative pricing by business. If it is a tax increase the MPs must account to their constituents for this.’
It remains to be seen whether the CMA has the power to examine government decisions. LEBC is making the claim on the grounds of fairness. Ingram feels that the fee increase is “a classic example of exploitative pricing by a monopoly provider, where the consumer has no choice but to use the service at a time of extreme vulnerability.”
Liberal Democrat leader Vince Cable also believes the attempted implementation of new fees without parliamentary scrutiny is wrong, saying in the Daily Mail that it is ‘a clear abuse of power’.
Ingram explained: “In reality this is not a fee but a tax increase. It is therefore a tax which should form part of a finance bill and be subject to full debate in parliament.”
Should the new fees be approved by parliament before implementation?