The Ministry of Justice had to ask for additional funding after failing to recover enough money in court fees last year, its top civil servant has revealed.
In a letter to the House of Commons justice committee, permanent secretary Richard Heaton (pictured) said the MoJ had requested an additional £427m of funding in 2015/16, with £259m of this due to additional demands and income pressure.
The spending review settlement in 2013 required a 10% real reduction in a single year on top of the 27% real reduction in spending made in 2010. The budget was then further reduced at the summer budget which followed the May 2015 election.
Heaton explained that the agreed original settlement was based on a set of assumptions agreed with the Treasury, which were viewed as ‘reasonable and realistic’, but extra demands from the criminal justice system and low fee income forced a change.
‘Our SR13 settlement was based on assumptions that workload in the criminal justice system would be broadly flat,’ he said. ‘What we have actually seen since 2013 is an increase in demand, driven by increases in the detection and prosecution of serious offences – in particular sexual and other violent offences, including domestic violence.’
He added: ‘Fee income has also not matched our expectations. This is the result of several factors, including unpredicted volume changes following introduction of enhanced fees in March 2015, delays to timetables for introducing new tranches of fees, scope changes, and decisions not to take forward some changes until 2016/17.’
Last December the MoJ announced that it would increase fees across a range of civil proceedings by 10%. These would affect enforcement proceedings, determination of costs proceedings and civil business in magistrates’ courts.
Fees were also introduced for the first time in the general regulatory chamber and tax chamber of the first-tier tribunal.
But crucially the government was forced to abandon plans to increase the upper cap from £10,000 to £20,000. The cap remained at the level introduced in March 2014.
In April 2014, justice minister Shailesh Vara said the previous year’s deficit from the civil courts system was £100m, and the courts could not be immune from spending cuts across government.
In his letter to the justice committee, Heaton argued the MoJ has managed its budgets well for the past five years, but a ‘combination of events went against us this year’.
The 2015 spending review settlement will see a further overall reduction in the department’s budget of 15% - equating to £1bn savings by 2019/20 after inflation.
‘By the end of the spending review, we will have made significant reductions from our administrative spend, as well as the running costs of our courts and prisons. That will be done by reform: we plan to create a more efficient and rehabilitative justice system.’