Fee Restructuring
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Following a public consultation exercise, Ministers have decided to introduce a more equitable system for the way in
which DVLA charges for the administration of driver licensing and vehicle registration. The changes will be phased in early
in the New Year.
At DVLA, we are required to recover the costs of our operations through fees levied for services. Review of the current fee
structure has highlighted that change is necessary in order to meet rising costs. Under previous fee reviews, the costs of
the driver and vehicle businesses were considered separately. The changes to the fee structure recognise the commonality of
many of our processes and bring the driver and vehicles operations closer together as we move towards new and more
integrated systems. Under current Treasury rules, income and expenditure raised by certain parts of DVLA's operations must
be matched separately. There is also a requirement to balance separately the vehicles and drivers accounts. DVLA is not
currently in balance.
We are now introducing a revised and simplified fee structure for driving licences and vehicle registration. The main
element of this will be the amalgamation of both the driver and vehicle fees into a single fund. DVLA is responsible for
the accuracy and administration of both the driver and vehicle registers in Great Britain and the vehicle register in
Northern Ireland on behalf of the Secretary of State for Transport. We are required to recover the costs of these
activities through fees levied for the full range of services. We are looking to integrate many of these business services.
These more integrated systems and processes will enable us to meet, through the supply of many services electronically,
the Government's targets to deliver e-services by 2005.
The revised structure will also enable us, using the opportunity offered by new technology, to develop integrated working
methods between our driver and vehicle systems and to improve our service to customers. The current fee systems have grown
over the past 30 years since the registration systems were centralised into national registers held at DVLA.
The basic fee structure evolved when processing was based on paper transactions and there was a very different level of
driver and vehicle registration. Previously, fees were altered to address cost pressures or introduced to meet new
requirements or reflect demographic changes. For example, in 1998 new fees were introduced to support the costs of the
photocard driving licence and for first vehicle registrations. Some fees have remained unchanged for a number of years.
The changes follow a fundamental review and assessment of the fee structure aimed at delivering a more equitable and
aligned service to all motorists whilst ensuring we continue to improve our efficiency which has increased by 18.5% over
5 years.
The new fee structure will see drivers who apply for their first licence paying less, with a single £38 fee replacing the
£41 paid under the existing two-stage system. In addition, the £6 currently paid by those over 70 to renew their driving
licences every three years is to be scrapped under the new scheme, removing the financial burden from older drivers.
Charges to add provisional vocational entitlement (to learn to drive lorries and buses) and to upgrade the driving licence
following successful tests are also to be abolished. These changes will help to address the current shortage of drivers
in the lorry and bus industry.
Replacing a driving licence or vehicle registration certificate due to a change of name or address will remain free of
charge, as will the addition of a new entitlement to a driving licence.
To partly offset these savings, and reflect more accurately the administration costs involved, a fee will be payable by
those motorists who are careless with their documents. Increased charges will be introduced to replace lost and damaged
driving licences and vehicle registration certificates. In addition, there will be an updated set of fees that more
closely reflect the costs of dealing with applications for the re-issue of a driving licence following revocation or
disqualification.
Also, to offset the savings to drivers, the fee charged to register a new vehicle is being changed, to match the reduced
£38 fee to be introduced for a new driving licence. New vehicles currently exempt, such as those in the disabled tax class,
will remain free to register.
By bringing the fee paid to register a new vehicle in line with the fee paid for a driver's first driving licence, DVLA
has rectified an imbalance and allowed savings to be passed on to drivers. We believe that the motorist will welcome the
more aligned and simplified fee structure.
Article by David J Morgan, taken from DVL Today - Issue 25 - Reproduced under Crown Copyright
Mon, 26 Jan 2004
