The thing is, should firearms applicants pay all the costs of their licencing? we pay for the police anyway with our taxes. Their responsibilities include keeping the great British public safe, which obviously involves keeping guns away from people who shouldn't be allowed anywhere near them.
However, there is also the counter-argument that if you want the cops to do the enquiries to decide whether you should keep guns, you should pay for that.
As with many things, there should be a compromise. Paying a percentage of the costs is the way to go I think. Which, I'm sure is what we do at present. I suspect the checks and enquiries that are done these days are more than they ever were, so whether in the long or short term, I can only see the price of grants (where they do them) and renewals increasing.