New Clause 3 — Annual fees

Part of Industrial and Provident Societies Bill – in the House of Commons at 10:30 am on 19 April 2002.

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Photo of Gareth Thomas Gareth Thomas Party Chair, Co-operative Party 10:30, 19 April 2002

I have considerable sympathy for the comments made by Mr. Knight and by my hon. Friends the Members for West Bromwich, West (Mr. Bailey) and for Wolverhampton, North-East (Mr. Purchase), and for the broad thrust of the comments made by the hon. Members for Bournemouth, West (Mr. Butterfill) and for Christchurch (Mr. Chope).

As has been indicated, this issue was raised on Second Reading, and my hon. Friends the Members for Corby (Phil Hope) and for Stroud (Mr. Drew) also highlighted their concern. The hon. Member for Christchurch was good enough to give me the opportunity during his speech on Second Reading to place on record my concern about these fees. During the consultation that I have undertaken in preparation for this Bill, and during discussions prior to this stage of deliberations on it, a number of sponsoring bodies of industrial and provident societies made representations to me about the level of fees. The WI Country Markets, the Village Retail Services Association, to which the hon. Member for Christchurch referred, the committee of registered clubs, which a number of my hon. Friends flagged up, and the Rugby Football Union are worried about the high cost of the registrations charges. I share the general view that the Financial Services Authority needs to act speedily to reduce the fees that it intends to charge from 1 July. As the hon. Member for Christchurch said, I have organised to see the FSA on Monday, partly as a result of discussions with him and the sponsoring bodies. I invite all hon. Members who are concerned to speak to me later. They are more than welcome to attend the meeting.

Although the reference to companies in the new clauses is illuminating in that it allows us to highlight the substantial difference between the charges for the registration of companies and of industrial and provident societies, it is slightly confusing. There is no monitoring regime for companies like that traditionally carried out for industrial and provident societies by the registrar of friendly societies. One reason for the monitoring is that industrial and provident societies hold community or even possibly public assets. The comparison with companies is inappropriate because the regulator has a more active role in approving changes and in monitoring the work and operation of the industrial and provident societies.

It is worth explaining to my hon. Friend the Member for West Bromwich, West and the right hon. Member for East Yorkshire that prior to the FSA taking over responsibility for regulation, fees for the registration of new rules or amendments to the constitution of industrial and provident societies were higher than the comparable charges for companies.