The Department for Science, Innovation and Technology has launched a consultation into proposed changes to the data protection fee regime.

Under the current regime, launched in 2018, three tiers of fees are payable annually based on the size and turnover of organisations. No changes have been made to the fee regime since its introduction meaning that, according to the consultation, the current fees are no longer adequate to cover the costs required by the Information Commissioner’s Office (“ICO”) to discharge its growing obligations and remain an “effective, forward-looking regulator”.

Therefore, the Government is proposing to increase the fees that are payable by data controllers to the ICO in order to (1) safeguard an adequate level of funding for the ICO; (2) ensure the fees are proportionate and spread fairly across data controllers; and (3) ensure the fee regime is easy to navigate for data controllers and to administer for the ICO.

The proposed changes will mean a fee increase of 37.2% in each of the three tiers. The tier structure itself – and the criteria for determining in which tier an organisation falls – will remain unchanged. The proposals mean that for large organisations in tier three (i.e. those that have more than 250 staff or an annual turnover greater than £36 million), the annual fee will increase by £1,079 from £2,900 to £3,979.

The ICO has welcomed the proposals. In its response to the consultation, it notes the need for the fee regime to reflect the “ever-increasing complexity, scope and scale of our work” and argues that “the current fee model no longer delivers the funding needed to achieve the ICO’s objectives. As such, we share the view of the Secretary of State that for the ICO to continue to remain effective, discharging our important and complex remit, a proportionate increase in financial resources is needed. We believe that the increase proposed in the consultation is proportionate and reasonable”.

Commenting on the consultation, Peter Kyle, Secretary of State for Science, Innovation and Technology, said, “I have a statutory duty to make sure that the ICO has the resources it needs to deliver its regulatory functions – and beyond this, a responsibility to ensure that the ICO remains a forward-looking, world class regulator. That is why I am consulting on an uplift to the data protection fees that fund the ICO’s data protection activities. These fees have not risen in line with inflation since their introduction in 2018, meaning the ICO today is delivering the same level of statutory responsibilities with significantly less real-term income. They also do not take into account the ongoing investment the ICO has needed to make in its capabilities over the last 6 years – and which it will need to continue making – to ensure it can regulate effectively in the rapidly evolving era of digital technologies and AI. An uplift in fees is overdue”.

The consultation is open until 26 September 2024, and can be read here.