GDC fee setting policy
The system of professional regulation in dentistry is, and will continue to be, funded almost entirely from fees paid by registrants. We have a duty to our registrants to minimise the burden on them by seeking efficiencies wherever possible.
We will incorporate and adhere to the following principles:
- Fee levels should be primarily determined by the cost of regulating each registrant group: We will seek to minimise the ways in which registrants fund regulatory activity that is not generated by them by removing, as far as practicable, cross subsidy between different groups. We will do this by allocating costs, as far as possible, where they fall. Where a degree of cross subsidy is necessary, we will explain this through our policy.
- The method of calculating fee levels should be clear: We will be open with registrants about how we allocate the income we receive from them and why, and provide sufficient information about cost drivers, giving them the opportunity to contribute to the debate. We will seek to show a clearer link between fee income and regulatory activity.
- Supporting certainty for registrants and the workability of the regulatory framework: We need to make sure that decisions on the allocation of costs do not lead to undesirable outcomes in the form of unacceptably high or variable costs for some groups of registrants. For example, in determining whether cross subsidy is necessary or desirable we will need to consider the impact on the volatility of fee levels (i.e. how much small changes in workload would cause the fee to change). This is likely to be of particular relevance to small registrant groups, where distribution of costs among small numbers of registrants has the potential to give rise to significant levels of volatility (and therefore uncertainty) and/or prohibitively high fees.
How we calculate the amount that needs to be raised
Parliament has set out the GDC’s statutory objectives in the Dentists Act 1984.
However, the law leaves us with considerable discretion as to other activities that we may elect to carry out in pursuance of the objectives. For example, we invest significantly in engaging with the profession and other stakeholders; we investigate and prosecute illegal practice; and we run a resolution service for complaints about private dental care.
We will pursue activity that is designed to:
- improve public protection, including through measures designed to prevent harm from occurring
- reduce the burdens of the regulatory system on registrants and make it fairer
- reduce the costs of regulation.
We will publish, maintain and update a rolling three-year corporate plan, which will be costed at programme/function level, and will outline clear objectives. The plan will set out:
- how we will deliver the obligatory functions that we must carry out
- how we will use the discretion we have to fulfil our broad statutory objectives.
The plan will be accompanied by key assumptions, including those relating to our own efficiency gains and will set out the amount we seek to recover from fees over a three-year period.
In formulating the corporate plan, we will take full account of the impact of fees on registrants.
Every three years we will therefore invite views on the strategic priorities and overall resourcing of our corporate plan before approving it.
How we distribute the costs among different groups and subgroups of registrants
In distributing the costs among different groups and subgroups of registrants we will use the principles set out above to operate a system in which:
- costs will be allocated as far as possible where they fall. We will set out in our corporate plan, where possible, the share of the costs for each item for each registrant group
- we will seek to avoid cross subsidy between different groups and sub-groups of registrants. Where we consider a degree of cross subsidy to be necessary we will draw attention to it and explain the rationale
- where we implement measures that would increase the cost of administering a fee we will do so based on a rigorous analysis of the legal, financial and operational constraints, and will determine and allocate those costs in line with the key principles underpinning this policy.
How we prioritise allocation of resources
We deploy all our resources to meet our statutory objectives of protecting patients and ensuring public confidence in dental services. In meeting that principle we will prioritise our resources as follows:
- Ensuring the financial viability of the organisation: this means that we will ensure that we have appropriate cash flow and reserves, in line with the relevant policies and procedures, to operate the GDC as a going concern and to reduce the need for exceptional changes to the fees. We will benchmark the main financial parameters against a range of appropriate comparators.
- Complying with our legal and other obligations, including meeting the Professional Standards Authority standards of good regulation.
- Investing in measures designed to improve public protection, including preventative measures, with a view to reducing, where we can, the costs and burden of enforcement action.
After meeting these priorities, if we are confident that we can reduce fees while delivering our statutory objectives, we will do so.
What we consult on, what we do not consult on, and why
We will consult every three years on the high-level objectives and associated expenditure plans which will underpin the annual retention fee. The consultation documents will be reasoned, costed and clear about the assumptions on which they are based, particularly in relation to efficiency gains.
We will consult on our proposals for distributing the costs of achieving the objectives among different groups and subgroups of registrants, including on any proposed cross subsidy, and any steps that might be taken to minimise the impact on those groups and subgroups.
While we will provide information on how our distribution plans affect fees payable by different groups and subgroups of registrant, we will not consult on the level of the fees. Nor will we consult on a detailed annual operational budget, although information about the budget will be made public as part of the Council’s budget setting process.
This is for two reasons:
- The costs of regulation are influenced by a wide range of factors that go considerably beyond the GDC’s detailed annual budget.
- Consulting on a detailed annual budget introduces severe constraints on the GDC’s ability to manage resources efficiently and effectively.
Over any three-year period, we will seek to use reserves to smooth any in-year changes in cost. However, in exceptional circumstances we may need to increase fees to pay for significant unforeseen costs. We will not consult on such increases, although we will be clear about the reasons for them and will provide as much advance warning as possible about potential risks.