Examination of Witnesses (Questions 20
- 39)
WEDNESDAY 25 APRIL 2001
LORD BACH,
MR GLENN
THOMPSON AND
MR ALAN
HUNTER
20. May I next ask you, how will the reforms
tackle the problems of delays in civil legal aid adjudication?
(Lord Bach) It is very important that they do tackle
those problems. One of the weaknesses of the system, and I am
grateful to you for reminding me, is the delay in the adjudication
of whether legal aid will be granted in a particular case or not.
Indeed anyone who has looked at the latest Legal Aid Annual Report
and, more particularly, the Report of the Lord Chancellor's Advisory
Committee on Legal Aid, which goes with the Report, will see that
really quite strong words were said about the failure as far as
adjudication has been concerned. The Legal Services Commission
will be responsible for legal aid in Northern Ireland once the
Order in Council is passed. It will be under a duty to make sure
that decisions are taken in an appropriate and speedy manner.
I do not know if either of my colleagues want to say anything.
(Mr Alan Hunter) The issue, of course, cannot be delayed
until the new Legal Service Commission is in place, for all of
the reasons the Minister has indicated. Indeed we anticipate that
the Legal Services Commission will be very proactive in that area.
There has been a recent review of the structure and how the processes
within that particular section of the Legal Aid Department function.
A new management structure has been put in place. That, we hope,
will continue to lead to the kind of improvements that are there
already and those improvements will continue. The existing structure
in the Legal Aid Department has been looked at and there have
been some changes made, with a view to increasing the turnaround
time.
21. One last question, if I may; you already
mentioned that the reforms will include a capping of civil legal
aid, one can understand that very much, but, of course, there
is the inherent danger that too much of the budget may be spent
too early in the year and that causes coming later in the year
can suffer. How, in general terms, will you address that?
(Lord Bach) There clearly could be problems unless
we dealt with it right at the start. There is no alternative but
to have capped budgets, the rest of Central Government has capped
budgets and it is absurd for there not to be capped budgets in
the field of legal aid, and there has not been up to now. A range
of factors will determine whether individual cases will receive
funding. They include priorities, which the Government will set,
which the Lord Chancellor will set, subject to Parliamentary approval;
the emergence of new areas of work; changes in demand for funding
in high priority areas and, of course, the availability of funding.
That is only one part of the factors that will be involved. The
question that you ask serves to emphasise the need for a range
of sources, not just public funding to enable litigants to pursue
their legitimate actions. The way we have sought to do that in
England and Wales is through conditional fee agreements in an
important part, the personal injury part, of the civil field.
We have to consider and listen to what advice we receive as to
what we should do in Northern Ireland in order to make sure that
the funding that we allow for civil legal aid covers all of the
high priority cases. If there are problems we do not think it
will be in the field of high priority cases, we feel that it is
more likely to be in the field of low priority cases under the
Funding Code. The Funding Code in England and Wales deals with
a whole variety of priorities. If I just tell you, the key ones
are the special Children's Act proceedings; civil proceedings
where the client is at risk of immediate risk of loss of liberty
or life; social welfare issues; domestic violence; proceedings
concerning the welfare of children and proceedings against public
authorities. These are priorities we have set in England and Wales
and I cannot think they will be very different in Northern Ireland.
Mr Clarke
22. I feel duty bound to thank you for calling
my questions early and I feel as if I ought to apologise to our
witnesses that I have to leave the meeting in a few minutes, no
disrespect is intended. I wonder if I can move us on a little
bit and ask a couple of questions in respect of the new Commission,
to what extent does the Government expect the Commission to purchase
legal services by contract?
(Mr Alan Hunter) The position as set out in the White
Paper is that the Government recognises that there are very peculiar
legal service arrangements in Northern Ireland for that and for
those reasons it may not be entirely appropriate to introduce
contracted services in the same way as has been done in England
and Wales. However, the Government has also decided that contracting
will remain an option which the Legal Services Commission will
have. The kind of areas where, in the first instance, the Legal
Services Commission might consider purchasing legal services through
contract might be in the not-for-profit sector, where they may
grant contracts to deal with some of the areas under the social
needs agenda. Equally, there are some specialist services which
might be suitable for procurement through a contracted environment.
This would all, of course, be subject to discussion with consultees
much further down the road and obviously the Legal Services Commission
would need to look very carefully at the impact it would have
on the community before it deals with those kind of issues. The
kind of areas which would be worth considering might be in terms
of legal services in the traditional sense, it might be clinical
negligence. Those are very specialist services where there are
not very many cases arising in Northern Ireland and, therefore,
there may not be a great pool of people who can conduct that type
of litigation. I do not know if this is correct, I am speaking
speculatively in terms of giving the kinds of areas the Legal
Services Commission might be interested in.
23. Would you be in a position to give the Committee
a percentage of that £43 million budget that would be used
in such a manner in terms of the purchase of legal services by
contract?
(Mr Alan Hunter) I have to say it would be a very,
very insignificant proportion of that £43 million. I have
also to say that one of the purposes of the agenda is in order
to enable the Government to direct where the priority areas of
spend are, so it may well be that if the Government decides, for
example, that housing issues became a very big issue in Northern
Ireland, or debt, or some of those Targeting Social Need matters
became crucial in terms of priorities and wanted to direct a higher
level of resources to that as proposed they would be enabled to
do so, although that represents a very small proportion at present
there would be a new environment in which it could operate.
(Lord Bach) Could I add to that, the proof that we
have listened to the consultees is to be found in this particular
field. The consultees were pretty well agreed that they did not
want to see block contracting coming in in Northern Ireland because
of the nature of the legal profession there; there are a large
number of very small firms, one solicitor or two solicitor firms
across the Province, which is largely a rural area. It would be
unfair to introduce contracting in the same way it has been done
in England and Wales. I hope the Government has listened and that
is why our original proposals are not to have block contracting
in the way that we have in England and Wales. We keep that in
reserve, of course, and that may be what is necessary in a few
fields or in many fields, but this is an example where we have,
I hope, listened.
24. That is very helpful. It is also helpful
when you suggested, rightly so, that the consultation process
will continue. My next question is in respect of the Government's
intention to look further at the introduction of CFAs, Conditional
Fee Agreements or a Contingency Legal Aid Fund. There seems to
be strong arguments against CFAs and as a Committee we have received
a number of representations concerning practical difficulties
with a Contingency Legal Aid Fund. Could you say what specific
market that fund, the CFA, if introduced, would be aimed at?
(Lord Bach) I am not entirely surprised you have had
a number of representations on this particular issue. We have
a decision to make as to what sort of system we have if we are
not going to continue with civil legal aid in the way it has continued.
You will know, I am sure, that we have asked the Advisory Committee
to look at the possibility of a CLAF in Northern Ireland. I must
make it quite clear that the Government is impressed by the way
in which conditional fees have worked in England and Wales. It
is early days; we think they have worked well and we think they
have brought in many people who have been able to claim their
civil rights, who were just outside the eligibility level when
legal aid was available for personal injuries. They have been
able to claim in that field and others. That is the great advantage
of a conditional fee system, if you have a good case there is
no reason at all why you should not get justice. What concerns
us about CLAF—and we are not making any final decision on
it until the Advisory Committee have reported, and we expect them
to report by the end of June this year. It would be ridiculous
to make a decision before they report and we know they are looking
into it carefully—is the expense of setting it up, the funding
that is necessary, the tendency for the merits test sometimes
to be set too low. If the merits test is set too low in effect
what happens is that when you have a clear-cut case, you do not
go to CLAF, you just conduct the case. Why should you be prepared
to pay some of your damages which you are entitled to into a CLAF
fund. We see, as a Government, a lot of difficulties with CLAF.
We want to wait and see what the Advisory Committee report says
and then make a decision. We should also point out there are possible
third ways, through insurance in Northern Ireland. Very interestingly,
the present President of the Law Society in his annual dinner
in December last year made it clear that he wanted the Government
to look at third ways of financing civil matters where legal aid
was no longer appropriate. That is something that we think the
Advisory Committee will be looking into as well. The great advantage
of conditional fees is that it, as I say, brings in everyone who
has a good case. If they have a good case then they are likely
to be able to use conditional fees and be rewarded for it. We
will need a lot of persuasion that conditional fees are not appropriate,
even in Northern Ireland.
25. That fullness of your answer has pre-empted
my next question, in fact answered my next question, which was
there is a risk that such a fund might end up handling more marginal
cases and the strong cases would not go through. I am grateful
for that. Can I move us on to a quote from paragraph 70 of the
White Paper, which refers to the possibility of, "Developing
financially viable and attractive legal insurance based solutions
to provide an alternative to private or public funding of litigation
for cases seeking financial damages." Could you inform the
Committee what sort of scheme the Government have in mind?
(Lord Bach) I am going ask one of my colleagues to
deal with this.
(Mr Alan Hunter) I think that Ministers recognised,
in their various visits to Northern Ireland and in the various
discussions with many of the consultees, that the legal insurances
markets in Northern Ireland have not developed in the same way
or to the extent that they have developed in England and Wales.
I think also some of the insurers may take the view that they
provide in many instances already legal services insurance under
their home contents policies and sometimes other policies. People
are not aware that they already have that kind of cover which
would enable them to pursue or defend various proceedings. I think
that one of the points which that particular section of the Paper
is trying to convey is that it is in everyone's interests that
that market is not only developed, but that people do recognise
that where they have those policies, that is something which they
can go to their insurance companies about and avail themselves
of that cover.
26. In that answer is there an acceptance that
it could be very difficult to encourage people to support a mode
of operation that currently is not that prevalent?
(Mr Alan Hunter) I think that certainly in discussions
with some of the insurance representatives it was their view that
the low uptake was more due to the fact that people simply did
not realise that they had the cover, and perhaps in other cases
may find it preferable to go by the traditional route of applying
for legal aid, but it is perhaps more an educational point. Also
I think that the market itself in Northern Ireland has not matured
to the extent that it has in England, and that is something which,
of course, is a matter for the insurance companies.
Mr McGrady
27. Good afternoon, gentlemen. I would like
to deal with the Funding Code. It seems to me that it is a key
element in the proposed control of the legal aid costs budget.
Would the introduction of the Funding Code indicate that there
will be a stiffer test of the legal merits of a particular application?
Could I also follow on from that and ask, will it also be subject
to the additional resources test as well as a legal merits test?
Give us a flavour of what the Funding Code would envisage in this
context of testing.
(Lord Bach) The first thing to say about the Funding
Code is that it would have to be passed through Parliament under
the affirmative resolution procedure, and changes to it as well
would have to come through, perhaps on a negative procedure. Yes,
it would set not necessarily harder tests, but new tests, as far
as what kind of cases should be assisted by the legal aid system.
In answer to a previous question, I set out what some of the key
priority areas were under the Funding Code in England and Wales.
I do not pretend they will be exactly the same in Northern Ireland,
but I think everyone will agree that, for example, children's
cases should have a very high priority in any funding code, wherever
it was. Of course, a funding code is really a name to signify
different merit tests for different types of legal aid work and
cases, and by establishing those different tests we feel we can
prioritise applications and target what are, as we have already
discussed and as I think it is generally agreed, limited public
funds. The Code will enable Ministers to ensure that all available
resources are spent on those who need help the most. However,
before the Funding Code is put into place and is put before Parliament,
I say again, it will be the subject of strict consultation and
will be informed by the research that will be conducted by the
Legal Services Commission—it will be one of their responsibilities
to conduct research—and pilot areas in various fields. Research
will be conducted into what is the appropriate funding code for
Northern Ireland. We think this is the most appropriate way of
informing Government's decisions when the Lord Chancellor has
to set out, establish and target priority needs. So the Funding
Code will really be a way of trying to make sure that the most
important cases are dealt with by way of public funding, and some
cases that are not of the greatest priority can be dealt with
in different ways.
28. The point I was making was that the test
of the legal merits would also be followed by or alongside the
resources test, would it?
(Lord Bach) Yes.
29. They would both apply in the Code, is that
right?
(Lord Bach) Yes, that is right.
30. In some of the submissions which were made
to the Committee already there is a criticism, which I am sure
you will appreciate we always get, of the proposed appeals mechanism
whereby the applicants appeal. In effect, the Legal Services Commission
would appear to be sitting in judgement on itself. That appears
to be unsatisfactory in general terms and certainly in these particular
terms. You might even have the irony of the applicant, having
been refused in the first instance, making application for judicial
review aided by legal aid cost, and there would be a double jeopardy
cost. Can you give some flavour of that?
(Lord Bach) I am glad you have asked the question,
because it is an important point, and consultees have expressed
concern about this point. Our plan or our proposal is, as you
have said, that where an application for public funding is refused,
the applicant will be able to appeal to an appeals panel, but
it will be an appeals panel of the LSC itself and it will comprise—and
this is important—two adjudicators from the LSC, of course
not those who made the original decision; and either a lawyer
or a not-for-profit representative, depending on who it is who
has not had their application for legal aid allowed. If it is
a solicitor, it will be a solicitor's representative. If it is
a member of the Bar, it will be a member of the Bar. If it is
a not-for-profit sector, it will be somebody from that sector.
The appeals panel will consider the appeal as a fresh application
and will either support the original decision or refer the matter
back to the LSC for further consideration. The appeals panel will
not have the power to overturn the Commission's decision. We think
the reason—a good reason—for that is that the Legal
Services Commission must retain sole responsibility for allocating
resources, in keeping with the Funding Code, reflecting the Lord
Chancellor's priorities. We fear—and I have to say this—that
if it is taken outside the Legal Services Commission who will
be given, as it were, the statutory duty to give legal aid, there
is a danger that the Funding Code system may break down. We feel
it is important and fair that it is done in this particular way
because, as you have pointed out, Mr McGrady, the final decision
of the Commission can, if it is outrageous, be challenged by way
of judicial review. We are not encouraging judicial review, although
I believe, of course, it is sometimes a step taken in Northern
Ireland, and the Chairman may remember during his time there that
sometimes that has happened. Also, of course, you would not be
surprised if in the early days, the early months of this scheme,
there are some judicial review proceedings. However, we need to
point out that judicial reviews are not appeals as such, and they
are reviews that, of course, can be helpful and informative in
setting up the parameters within which the Commission will operate.
The Code that would be the basis of whether legal aid is granted
or not, I want to repeat, will of course be subject to parliamentary
accountability. That is a very important point to remember.
Chairman
31. I think Mr Hunter wants to add to that.
(Mr Alan Hunter) Yes, if I may make one observation.
The procedures and so on in terms of the Funding Code, the Codes
of Practice and so on, and the arrangements for the parliamentary
scrutiny, will, of course, be subject to public consultation in
the context of consultation of the proposed draft legislation.
However, as you will be very familiar with, the arrangements in
what is known as the reserved field under the Northern Ireland
Act, in terms of what would be normal in the Westminster situation,
translate into different arrangements in that particular area
of reserved matters. So although the Funding Code would ordinarily
be subject perhaps to an affirmative resolution procedure, the
context in Northern Ireland may well translate that in due course,
because of the arrangements under the legislation at Westminster,
the arrangements for that will still be subject to some consultation
in the context of the proposed legislation.
Mr McGrady
32. I am sure it is an area which will provide
much further debate and argument in the months ahead, but we will
leave it at that for the moment and move on to another area. The
purpose of the exercise, of course, is to improve the quality
and the standards of legally aided service systems. There is a
Working Group, I understand, addressing the development of quality
standards. Could you indicate to the Committee what progress that
Working Group has made, or is making, towards that objective?
(Mr Alan Hunter) The Government decided that there
were a number of areas where further close consultation with those
directly involved in delivering these services was going to be
necessary before practical effect could be given to many of these
proposals. In that context, several working groups were discussed.
The Working Group on Quality has not yet been established, but
it will be established closer to the time of implementation of
the legislation. It is interesting to note that the professions
themselves have recorded the need for continuing education. The
Law Society has recently introduced a requirement for continuing
education. So there is movement in that area, but the Working
Group itself will not be convened until much closer to the time
of the implementation of the new system, because the new procedures,
of course, cannot be given effect until the Order in Council itself
is made.
Mr McGrady: Thank you very much, gentlemen.
Mr Beggs
33. Good afternoon. A key element in cost control
appears to be the proposal for all-inclusive standard fees for
the majority of cases. What progress has been made towards developing
these?
(Lord Bach) We are intending to set up a working party
on remuneration. Indeed, in the last week I have written to both
the Bar Council and the Law Society, with a view to setting up
such a working party in the course of the next few months. We
ourselves have done some work on what we feel standard fees are—not
the level of them, but what the criteria should be for standard
fees. They will be fixed by regulation. They will be all inclusive,
with separate scales for preparation, advocacy and expert witnesses,
but there will be separate arrangements for disbursements, which
I think is something that will be appreciated by the professions
in Northern Ireland. Can I briefly deal with the range of principles
that will guide the level at which standard fees will be established.
These include firstly, the time and skill which the work requires;
secondly, the general level of fee income arising from the work;
thirdly, the cost to public funds of the provision of the service;
fourthly, the availability of resources; and lastly, public sector
comparables. As I say, the working group will be set up, and we
would give those criteria to that working group and see what they
have to say. I dare say they will have quite a lot to say about
them. As far as public sector comparables are concerned, that
is a benchmark that includes a range of comparisons with other
professions. Of course, on a true basis, the remuneration package
has to include expenses such as pensions, sickness benefits, paid
leave, support staff and office overheads, but I need to make
it absolutely clear that the standard fees that are set will not
necessarily bear any relationship with fees that are paid now,
and it is very important that I make that clear to the Committee.
Chairman
34. I think that Mr Hunter wants to come in
there.
(Mr Alan Hunter) I have one observation to add, if
I may. The increase in criminal legal aid is as a result of the
statutory test enshrined in the current legislation, which fixes
only one criterion for the assessment of fees, which is a fair
remuneration as determined by those who independently know about
these things and deal with them in terms of the Taxing Master
at the High Court supervising the equivalent department. The clean-sheet
basis upon which the new standard fees will be set is something
which will take into account all the factors set out in the White
Paper as being the criteria against which the new standard fees
will be assessed. That is why there will be no direct link with
the existing levels of fees.
Mr Beggs
35. Given that the Government does not intend
existing fees necessarily to be the starting point for fixing
standard fees, is there still not a risk of creating a two-tier
profession, with publicly funded work the poor relation of private
work? Might such a situation act to reduce the choice of lawyer
for those dependent on legal aid?
(Lord Bach) We do not think that there will be a second-class
service for legal aid litigants, for two reasons. First of all,
we are determined that the standard fees and the payment out of
legal aid for criminal work shall be on a quality assured basis
to citizens. It is very important that there is quality assurance,
and there have been moves by the professions in Northern Ireland
to make sure that that is done, but we believe it has to be seen,
and that is why we are going to set up the registration and the
code of practice which will be crucial for anyone who wants to
practise under legal aid. Secondly, we think it will secure the
best value for money from the services purchased at public expense.
In legal systems throughout the world there is no way in which
publicly-aided work can keep pace with the kind of rates which
can be found in private work. If we sought to do that, we would
be chasing a very elusive runner, and it would be desperately
unfair on other parts of the public service that require money
as much as legal aid does. So to try to compare legal aid rates
with private rates, for example, in commercial work is something
that is pointless and something that we would not even consider.
What is important is that the rate that we set is fair and represents
the various criteria that I have tried to set out. There is, if
I may say so—and this is true in Northern Ireland as well
as in England—a great feeling about appearing for those
who are not necessarily able to pay for their own defence or their
own cases. Those who do public legal aid work—and I must
say that a large part of my life was spent doing it in the criminal
field—feel that you know you are not getting as much as
people who are just doing private cases all the time, but you
do get a satisfaction, I think, from doing that sort of work.
I think that is a factor that the legal profession should bear
in mind as well.
36. Will the Legal Aid Advisory Committee continue
in existence when the new system comes into being? If so, how
will its role change?
(Lord Bach) No, it will not. It will not, in the same
way as the equivalent body in England and Wales has finished once
the Legal Services Commission was established. I cannot say how
grateful the Government is—and I am sure particularly the
Chairman, from his time in Northern Ireland, will echo what I
say—for what the Legal Aid Advisory Committee has done over
many, many years, and it is still playing a very important part.
Frankly, though, as paragraph 45 of the White Paper or the Decisions
Paper makes clear, there will be no requirement for that Committee
once the Commission is established; in effect, its function will
be obsolete. However, that is not to say we do not recognise what
a huge amount of work it has done in the last number of years.
37. Thank you. What assessment has been made
of the financial implications of transferring the administration
of legal aid to the new Legal Services Commission?
(Lord Bach) We have done some work on that. It is
hoped, of course, to set up a shadow Legal Services Commission
much nearer the time, so the new system can come in. We have set
aside £½ million to cover expenses in setting up the
new Commission; it is to cover the shadow Commission I have just
referred to, Mr Beggs, and the new functions of the Commission—and
there will be some new functions of the Commission—including
research projects that are going to be important when we set up
the priorities for the Funding Code and also setting up pilot
areas too. So we have set aside money so that the Legal Services
Commission can come in and, hopefully seamlessly, begin its very
important work, taking over from the good work that we believe
the Law Society has done up till now.
Mr Beggs: Thank you very much.
Mr McCabe
38. Thank you, Chairman. I want to ask a couple
of questions about criminal legal aid. The first point is fairly
straightforward. I wonder if you could give us some idea of what
the likely practical impact will be of the change in the arrangements
whereby the Commission, rather than the court, will now determine
the number of counsel? I wonder if you could say something about
the reasoning behind that, as well as the practical impact?
(Lord Bach) I am going to ask Mr Hunter to deal with
that.
(Mr Alan Hunter) The new arrangements will, in terms
of criminal legal aid, introduce some very new elements to the
system, but in many ways will also recognise and will preserve
the best of the system as it is there at the moment. The Government,
for example, in future will decide how much lawyers are paid under
the standard fee system and will prescribe what are exceptional
cases which will go for independent assessment. Another feature
on the costs side of the new criminal aid scheme is that at the
moment there are no contributions from applicants for criminal
legal aid, whereas in England and Wales since 1988 there have
been applicants that are required to make a contribution towards
the costs of their criminal defence, if their level of resources
is sufficient to enable them to do so. The new arrangements, as
set out in the White Paper, will enable the convicted defendant's
costs orders to be made, but at the end of a case someone who
has been convicted will, in appropriate cases, if they have resources
and it is possible for them to do so, be required to make a contribution
towards the costs of their defence. As against that, the quality
assurance mechanisms, of course, which are being introduced in
the code of practice, will require practitioners in the criminal
field, as in the civil field, to meet a level of quality of service,
and what those standards are has yet to be discussed and consulted
with with the legal aid professions. The Legal Services Commission
will have power to certify the number of counsel which should
be assigned to a criminal case. That will be a new feature, because
at the moment that is a matter which is reserved to the judiciary.
The Government has indicated also in the White Paper that it does
intend to look at the possibility of a public defender system—in
other words, salaried defenders who will operate as the defence
counsel in certain cases. That would obviously have to be piloted
and would be subject to research. The Government has indicated
its commitment to do that.
39. Would it be fair to say that this is based
on an assumption that the courts have been too free in allowing
several counsel to be involved in particular cases? Is that the
reasoning behind this?
(Lord Bach) I think I should make it clear that the
court will still be responsible for deciding whether it will be
appropriate for the defendant to be allocated counsel in a particular
case, which, of course, is in many ways a very important decision.
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