TUESDAY 23 JULY 2002

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Members present:

Mr Chris Mullin, in the Chair
Mr David Cameron
Mrs Janet Dean
Bridget Prentice
Bob Russell
Mr Marsha Singh
David Winnick

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Memorandum submitted by The Lord Chancellor's Department

Examination of Witnesses

SIR HAYDEN PHILLIPS GCB, Permanent Secretary, MR IAN MAGEE CB, Chief Executive of the Court Service and MS JENNY ROWE, Director of Finance and Corporate Affairs, Lord Chancellor's Department, examined.

Chairman

Good morning and welcome, Sir Hayden, Ms Rowe and Mr Magee. I am sorry we seem to be rather depleted this morning. I am told that one or two of our number are tied up in a debate on the Criminal Records Bureau and will be joining us shortly. Perhaps I could just start the ball rolling by asking you about the size of your department - it seems to be growing.

(Sir Hayden Phillips) It is growing.

You have picked up electoral law, freedom of information, data protection, human rights and some aspects of the Lords reform. Is that a comprehensive list of the new additions?

(Sir Hayden Phillips) There are a number of additions, both last year and this year. Perhaps I could say that in addition to those big machinery of Government changes, which have given a very wide constitutional dimension to the department along with justice, in the core work we have been doing there has also been a lot of activity, all at the same time, both in civil justice reforms now, following the White Paper and, leading up to it, in criminal justice reforms, administrative justice looked at by Leggett and a great deal of work on changing the Legal Aid system. So a very high level of activity over the last two or three years, plus the additional responsibilities, has in a way changed very much the nature of the department, the pressure it works at and the pace it works at.

Do you think it has reached perfection now, or is there scope for further expansion?

(Sir Hayden Phillips) I think perfection is something we shall continue to strive for, and it may just always be slightly beyond our reach.

Do you see it consolidating at this size or do you see it continuing to grow?

(Sir Hayden Phillips) I think that there will be some further growth as a result of the Government's decisions announced in the White Paper on criminal justice. There will be a single agency covering all the criminal courts, including the magistrates' courts, which will mean absorbing I think about 10,000 staff from the magistrates' courts into the departmental structure. That will be a big and major change which Ian Magee will be leading. In addition, if ministers decide, collectively, that they want to make changes in administrative law in relation to tribunals, as Sir Andrew Leggett recommended, that would then produce another further, big, single tribunal service, and again a very large accretion of work and staff. So there is enormous potential still for considerable growth.

Do you think your department's work is adequately scrutinised by Parliament?

(Sir Hayden Phillips) I very much enjoy coming on my own to this Committee and with the Lord Chancellor. The scrutiny has grown and our accountability has grown (when I arrived there was one junior minister and now there are three - one in the Lords and two in the Commons), but I am sure there is a whole range of areas, particularly now with the new ones coming to us, which the House authorities will want to think about how it is best that we are examined and made to account for what we do.

Are you aware that this Committee has suggested that a separate Lord Chancellor's Select Committee be set up?

(Sir Hayden Phillips) Yes, I am aware of that. There will always be an inter-relationship between the work we do and the work of the Home Office and the Crown Prosecution Service throughout the criminal justice system. So there will always need to be an arrangement by which a Committee - whichever one it is - was able to take evidence - jointly if necessary. I have appeared with the Home Office Permanent Secretary, for example, the PAC and the Director of Public Prosecutions, and that can be a valuable way of looking at criminal justice on the whole. I think the best thing I can say is that there obviously are pros and cons, and I think this is a matter best left between the House authorities and the Lord Chancellor, but we are aware of it.

Just run over the cons with us, for a moment.

(Sir Hayden Phillips) The central issue, it seems to me, is whether the links between the work we do with the other two justice departments are so strong that it would be a mistake to break the link - in other words, to have separate committees looking at the same issues. I think that is the main con.

Our difficulty, as you know, is that the volume of work which comes out of the Home Office is so vast that we feel we have not been able to give adequate attention to your department. What do you say to that?

(Sir Hayden Phillips) I understand your feeling. It is quite difficult for the Permanent Secretary to comment on whether or not you are able to cope with your workload. I do understand the issue and I do see the pressure for this change.

Has the Lord Chancellor been consulted about our proposal?

(Sir Hayden Phillips) Yes and he is thinking about it. He has not formed a decided view, as far as I know.

When would you expect him to?

(Sir Hayden Phillips) I hesitate to say before the summer recess, since from the House of Commons' point of view that begins tomorrow. I think we should come to a view in the early autumn about the way ahead.

You would accept that it is not really for those who are to be scrutinised to decide how they should be scrutinised?

(Sir Hayden Phillips) That is why I am answering you in an unusually diffident manner. As I say, it is very much a matter for the House authorities.

Chairman: We will look forward to developments on that front. Can we now turn to performance targets?

Bridget Prentice

In your response to our written questions, the targets that were set to be met by 2001 seem almost all to have been replaced, remodelled, changed, dropped, or whatever by 2002. What has the latest Comprehensive Spending Review done to your targets, and which is the most challenging?

(Sir Hayden Phillips) There are a number of changes. I will try not to be too long. There is a target that brings together, for SR2002 period, confidence levels in the criminal justice system linked with satisfaction of users - principally victims and witnesses - and rather than setting a percentage target for that improvement it simply says we should make improvements on a year-by-year basis. That is better because the level of satisfaction of users in the system was, in the Crown Court area, for example, about 79 per cent, which is the highest bench-marking figure for other public service organisations you could get. To set a 5 per cent increase on top of that would be very challenging. So that is one change which has brought those together. In terms of trying to improve the rate at which offenders are brought to justice, there is now a specific target of trying to ensure, I think, that offences for which offenders are brought to justice should be set at 1.2 million by 2005/06. That gives us a target for the next two years or three years which, together with the police and the CPS, we must try to work towards. In other words, the change there is actually to specify a target figure where there was no target figure before. I think the final point I would make as far as the changes are concerned is that we have dropped the target which says that we should secure increases of at least 5 per cent in the number of international legal disputes resolved in the UK. It is very difficult to get bench-marking information but it is also very difficult to analyse and be sure about the precise effect of government action in achieving that target, as opposed to the marketplace. I think it is sensible to drop that while still pursuing it. I am sorry that is a rather long answer. I do not know, Jenny, whether you want to add any comments on SR2002.

(Ms Rowe) The only other one that I think is different is that we now have a specific PSA target with the Home Office on asylum and the overall number of PSA targets has been reduced in line with Treasury attempts to hone the number down.

A specific target on asylum?

(Ms Rowe) Yes.

Asylum appeals, presumably?

(Ms Rowe) Yes.

Thank you. That was quite a long answer. However, it is not quite as baffling as the targets themselves. If people outside the department find the targets baffling and incomprehensible, how confident are you that people within your department understand them?

(Sir Hayden Phillips) First, on the baffle point, I think what we should try to do in future, in terms of public explanation in our report, is not to have a great run of changing targets year-on-year and give the whole history, which I think is confusing. When I looked at the questions we were asked to provide supplementary evidence on it was clear that the story was unnecessarily complicated. What we should be doing is concentrating on the six or seven key targets for the last year rather than going through all the bases on which they were changed. As far as internal understanding is concerned, I think that is high. We have ensured that for each target there is a senior member of staff who is in charge of understanding all its ramifications and who is supported by a group of people who are involved in delivering that target. Internally there is, I think, a fair degree of understanding. I think the issue is to be able to explain what we are doing in a clearer way publicly, year-on-year. I think this is a rather confusing picture that we have presented in the report.

So we will see a more streamlined report in future?

(Sir Hayden Phillips) Yes, absolutely.

Just sticking with the business of targets for a moment, the Home Office said in their evidence on targets that specified targets and relevant performance parameters can sometimes be complicated by the need to avoid perverse outcomes and unexpected impacts on other targets. There is then a very long and confusing sentence that, I think, the Plain English Campaign might want to have a look at. "Perverse outcomes and unexpected impacts on other targets". Can you give us any examples of perverse outcomes or unexpected impacts? When those targets are being drawn up, how do you assess the effect of achieving one target on other priorities?

(Sir Hayden Phillips) I think, as a generalisation, it is certainly true that you have to watch very carefully that in driving down to pursue one particular area of success you do not, in fact, as it were, create problems in another area. It is partly an issue of resourcing and partly an issue of concentrating people's minds. An example of where you could find there was a potential conflict is in the balance between a target for delay through the courts, on the one hand, and achieving substantive results on the other. In other words, if you drove too fast for delay and you moved too quickly you might not do the work sufficiently well to secure the actual results you might want. That is the sort of conflict that has to be managed within the court system all the time. I, personally, think that it is very important we do have targets for delay because if we do not keep our foot on that accelerator the risk is that cases will drag out - witnesses will get frustrated and irritated and may drop away from the case - and it is more likely that you will get adjournments and then an unsuccessful result. That is an example of where you have to try and keep a balance. I do not know whether my colleagues have any other examples in mind where we might, within our own area, have created conflicts that are difficult to manage.

(Mr Magee) I do not think we have created a conflict. First of all, the balance which Sir Hayden referred to, between quality and quantity is a really important one and I do not think there are perfect answers to that because speed is important in the delivery of justice. There is an area that we need to watch, and it is best to be frank with you about this. We have set, in the court service, for the first time this year, a target for the progression of family work and, particularly, for children and care work, for example. We will not have the first set of results from that until later on this year, but our dipstick approach in the first few months of this year seems to say that there are undue delays in family. We have got one resource, which is civil and family sitting days, with which to tackle justice on the civil side, including family. You would want to know what we were doing about that. I think the setting of a target of itself, in my view, is helpful there because it helps to illuminate the position. What we seek to do is to engage with the President of the Family Division about some of the results that came out of a survey that was published just in March of this year to see whether we cannot get better case management in family cases, for one thing, and, from my perspective in managing the court system, I will need to see whether we need to achieve a better balance between sitting days in family cases and sitting days in civil cases, possibly - coming back to the question about perversity or otherwise - to the detriment of the good results that we are achieving on the civil side at the moment.

Are you concerned about any conflicts, perhaps, between targets that are set for the Home Office and targets that are set for your department? Do they ever clash?

(Sir Hayden Phillips) We try to make sure they do not. This is work that over the last few years has been done very closely together, both in relation to criminal justice and in relation to asylum. Perhaps I can take the asylum example. It is very important that we do not allow a system to arise in which the Home Office are clearing cases out of their path so quickly that we build up a vast backlog and bottleneck in the appeals process. So we need, with them jointly, to manage the flow of cases through the system in a sensible way. So their targets, as it were, and our targets have to be agreed between us, and we have people from the Home Office working with us and we have people sitting on their board to make sure that that connection is made throughout. I think the answer to the question is that we have done everything we can so far to make sure there is not an inherent conflict between the targets set for the Home Office and for ourselves in areas where we have a joint responsibility. I do not know, Jenny, whether you want to add to that.

(Ms Rowe) I was only going to say that, in fact, the asylum target is a joint target between us and the Home Office, and some of the criminal justice system targets are as well. So they are in our Public Service Agreement and are identical in the Home Office Public Service Agreement as a way of overcoming any potential problem.

So in relation to the situation, for example, in asylum, when the Home Office did have a target of 30,000, you would have been confident that you could have dealt with the appropriate number of appeals that would have arisen from that?

(Sir Hayden Phillips) Yes. The question is the rate at which you can dispose of them and the rate at which they flow through the system. As you know, this is an area which has increased enormously in size. In terms of our own responsibility, there has been a 75 per cent increase in the number of appeals successfully passing through the system, comparing the last year with the year before. The figures really are very dramatic indeed. The size of the jurisdiction in immigration and asylum has increased by 50 per cent - judges, part-time and full-time, administrative staff, back up - and something like a 300 per cent increase in administrative workload has been dealt with by only a 30 per cent increase in staff. I mention those figures because I think it is important that the Committee and the department understand how enormous a change this has been and how, despite that pressure of work, we have managed to keep quite a good flow through the system and to cope with increasing Home Office efficiency in deciding their cases. I think the problem in our part of the system is that whereas the Home Office are dealing with an administrative process within house, by the time it gets to us - if I can put it that way - we are then bringing together people from the Home Office, people from the defence, interpreters, judges and so on. So we move into the normal, as it were, court environment where the number of players is greater and where, of course, they are not all of them under our control in the same way as the Home Office can be in control of their own cases. That is why we have this target of two months for the Home Office to deal with their part, four months for us and an overall average through the process of doing 65 per cent within that four-month period.

I do not want to go down the asylum route too far because we will come back to that later. Can I just turn to the target for offenders, not just for young offenders? We got the impression from the Home Office that the target that was to be set for March 2001 has been delayed. When do you think that target will be set?

(Sir Hayden Phillips) I have to be clear about which particular target we are looking at. Is this about delay?

Arrest to sentence for all offenders, not just the fast-tracking of young offenders.

(Sir Hayden Phillips) No, that has not yet been set. We can give you figures for a number of the areas of delay because we have our own internal targets for that, but I think that has not yet been set.

Do you have any idea when it is likely to be set?

(Ms Rowe) We will be discussing targets with the Home Office and the CPS now in the light of the SR2002 settlements. So I would hope there will be targets set before Christmas, probably.

Before Christmas?

(Ms Rowe) I should think so.

Would you say that part of the delay is because of the emphasis on getting and achieving the target in dealing with young offenders, or is that a separate issue?

(Ms Rowe) We gave priority to the target for young offenders and a lot of resource and effort went into that, because that was seen as the most important issue to tackle. So that came first and then we are looking at the other areas.

So it would have had some impact?

(Ms Rowe) Yes, it would.

(Sir Hayden Phillips) If I may say so, also, the setting of an overall, global target is actually a difficult exercise. We have been quite successful, I think, in setting individual targets for particular parts of the system, but taking it right from the moment when an offence is reported, as it were, or an arrest takes place, right through to the end, is quite a difficult analytical exercise to make sure you have got it right. So I think it is not just being diverted, in a sense, on to the persistent young offenders target, it is also intellectually quite demanding.

Why is that?

(Sir Hayden Phillips) Because you have to try to set something which deals with the varying rhythm of work and pressures of work of, really, quite different organisations - the police, the CPS and the courts - and trying to do that and then adding up the bits is not easy. I think that is the simplest explanation.

(Ms Rowe) There is also the case mix because you have some very long and complex cases which you know are going to take considerably longer than others, and if you try and average them out you do not necessarily get a very helpful statistic about what is really happening.

Perhaps we should not be setting that type of target.

(Ms Rowe) The sort of targets we are going to be looking at are targets for specific categories of case. That is the area where it is falling at the moment. I think that will actually be more helpful.

(Sir Hayden Phillips) I think it is important that we have targets in areas where each of the agencies knows they can operate effectively. I personally agree with you, I think that is a better way forward than just having a global target that is not then translated down into individual targets for actions by each agency.

Mr Magee, would you like to add to that?

(Mr Magee) May I say a word about the whole system, as far as criminal justice is concerned? I am chairing a group with practitioners from each of the criminal justice agencies looking at the specific point that you mention - whether there are any of the targets that we set individually that are getting in the way of one another. As an agency chief executive I have a set of targets and a pile of cash with which to achieve those, but we want to make sure that the overriding government objectives are met rather than that parts of the system, as Sir Hayden was saying, perform well, possibly to the detriment of other parts of the system. So I have got a group together which includes representatives from each of the agencies and that reports into the strategic board that John Gieve leads and Sir Hayden and the DPP sit on. That work is at a very early stage. That is one part of it. Another part of it is this - and again it refers back to a question that was asked earlier: the world "culture" is perhaps over-used but it seems to me, as somebody who has been an operational manager for a long time, that it is not actually very helpful to people at the front-line to have rafts of targets, some of them set generally and nationally and some of them specifically and locally, that begin to get in the way of one another. I think what we have to do is listen to what local areas are saying to us about the plethora of targets and try to act on it and see whether we cannot remove some of the gratuitous target-setting that goes on. This can occur in all sorts of different ways - sometimes collecting information that may go back, we have found already, a long number of years. It is relatively easy to put a stop to all of that, but the process of engagement with people, so that they are very clear about what it is that the Government wants to achieve collectively and how it is that their part of that fits in, is a very important part of the process.

Bridget Prentice: Thank you very much.

Chairman

Sir Hayden, you are a civil servant of the old school, I think. Are you not?

(Sir Hayden Phillips) If you mean I am relatively senior as a Permanent Secretary, I will take it in that sense.

You have been around a long time. You will remember the days when we did not have targets.

(Sir Hayden Phillips) Yes, I can.

Do you think they are a good idea or a bad idea, in principle?

(Sir Hayden Phillips) I think, in principle, they are a good idea. The key thing is to (a) make sure you are really setting targets that are not just those that are measurable but those that really do produce outcomes. That is intellectually difficult. Secondly, I do believe you should keep the number small and sensible, rather than allow rafts and rafts of targets to grow. There was a period in which more and more things sprang up all over the place, producing the sort of results that Ian has described. I think we should try and get a small number, concentrate on the big picture and then try to make sure that locally, where people are delivering things on the ground, they understand what that clearly means in their particular locality and adapt for that as necessary. So I think there has been an advance here; there was a period when we had far too many and I hope now that we are reining back on that and focusing and concentrating more clearly. That partly goes to the point that was raised earlier about having them publicly explicable and not a total raft of confusion.

So you think we are getting now to the point where there is a happy medium?

(Sir Hayden Phillips) I think we are moving in a better direction and we are reining the number back and focusing much more on real outcomes, rather than simply things that happen to be easily measurable, which may give you a totally partial impression of the organisation. I have discussed this with Ian Magee on a number of occasions and we have tried to make sure that in relation to the court service we are concentrating on things that really matter and not just getting people to count things because they are easy to count.

Do you think the Treasury understands that?

(Sir Hayden Phillips) Yes, I think they do understand that now. Certainly they have taken the view, I think, in the SR2002 spending round that we should progressively try to limit the number of key targets, particularly the ones that are published and to which we are publicly accountable. I am sure that is right.

How did it all get so out of control?

(Sir Hayden Phillips) I think in the early days, when people were told they had to have targets, people got it into their heads - and I think this is true in departments and, probably, in the Treasury - that the more you had the more points you got. I think there was a real sense in which that grew up. Talking about the over-use of the word "culture", there was a period in which that was the culture. I do not know whether Ian, from his experience, confirms this as a true record or it is just my prejudice. I think the next phase was one of people saying to themselves "Well, are these the real targets that matter?" Often it turned out that they did not, they were just there to tick the box to show you had done it. Now I think we are into a phase where we are saying "First of all let us choose the targets that really do matter and, secondly, let us really limit their number to those things that are absolutely essential to government policy."

(Mr Magee) I have worked in three very different executive agencies since 1989 - nowhere else but executive agencies - and what I observe is this: (a) that what Sir Hayden says is right and (b), that that is, in some part, down to a maturity of approach that did not exist, candidly, in the beginning. There was a sense, when one first went into executive agencies, that the centre of the department was targeting the easily measurable and we all know that you get what you measure. So it was not a particularly difficult job in those days for agency chief executives worth their salt to meet those targets. Whether it made a difference to what it was that we were really committed to, which was improving significantly the service that we give to the public, was a different matter altogether. The maturity of approach comes from the centre of the department and the relationship with those on whom targets would be set, and I do believe that we have made significant progress - probably exponential progress, actually - over the last four or five years.

So you are reasonably confident that in two or three years' time when you come to see us we will not be told that today's targets have been amended, dropped, replaced, modified or subsumed?

(Mr Magee) No, I cannot be reasonably confident of that for all sorts of reasons. I suppose the first one is that life moves on and things assume different degrees of priority and importance, and we have to respond to that.

(Sir Hayden Phillips) Chairman, I will say that obviously we cannot give that guarantee but what we will try to achieve, with the Treasury, is greater consistency, year-on-year, so you do not get this swinging about, and you do not therefore get the plethora of comparisons that one has to make. I think that is a very important target to set for target-setting.

Chairman: On that point we will conclude on targets. Thank you.

Mrs Dean

Looking at delays in the courts, what are the latest figures for the time from arrest to completion for all offences?

(Mr Magee) In the magistrates' courts from listing to completion I do have, and that is 34 days or less. That is the average.

(Sir Hayden Phillips) I think it has come down from 35 days in 1997 to 28 days in 2001. So that is an improvement. Another figure we can give you, if it is all right, is the time taken from charge to the first listing of a case, which fell from 21 days in 1999 to 8 days in 2001. So in both of those areas within the court process there has been a very substantial improvement, and you are aware of the results on persistent young offenders, where that target is met early and it is now down to 6-7 days. So we can give you the elements of it but not necessarily easily the overall global target.

Has that trend continued since September 2001?

(Mr Magee) Yes, as far as I am aware it has continued. I do not have the figures to hand, because I guess it will be later on this year when the annual figure becomes available.

The department's annual report describes a target which must be related to the speed with which cases are taken through the crown courts. Why was the target of maintaining the rate of 78 per cent of Crown Court cases commencing within 16 weeks in 1999/2000 first of all "amended", then "not met" and finally "not mentioned"?

(Mr Magee) We still do have that target, in fact. It has been a constant that we strive to clear 78 per cent of cases within that period. The mixture of work in the Crown Court has changed pretty significantly over the last three years. For example, there are, on the whole, fewer guilty pleas now, and you can obviously dispose of a guilty plea rather more quickly. The good news on that target is that for the first months of this year - from April onwards - we are meeting that target for the first time, I think, ever in the court service. We are now running at 79 per cent.

Good. Turning to witnesses, it is a target to improve the service for witnesses by reducing the average waiting time and by reducing unnecessary attendance. What is the actual target for unnecessary attendances by March 2004?

(Sir Hayden Phillips) We have reduced the percentage of witnesses called but then do not give evidence, as it were, from 53 per cent (that was in 2000) to 50 per cent in 2001. These are small but significant changes in terms of improvement. We also have a concern about how long people have to wait at court, and the average waiting time is about an hour and 20 minutes, which is again a small improvement from before. I think they are the two main figures that are in my mind.

(Mr Magee) I do not think that these figures are of themselves ones that should cause any complacency because we all recognise that attending court puts stress on witnesses and we have got to do our utmost to get down still further below those figures. Fifty-one per cent of all witnesses in the magistrates court are dealt with within the hour, and obviously averages disguise some much longer cases as well. It is an issue about co-operation across the criminal justice system too, because, as you will realise, it requires all agencies to come together in order to reduce that witness waiting time. We have got some measures in hand to do that. I can think of two. One is that we have introduced into the magistrates' court world a "cracked" and ineffective trials monitoring scheme. It was only introduced in April of this year and we have not got the results yet, but it will help to identify the reasons for unnecessary attendance and that will give us the opportunity to try to deal with those reasons. The second is that the Magistrates' Court Inspectorate is going to produce a thematic report on court listing practices later on this year. Obviously the results will be in the public domain. Again, that will help us look at the good and the less good, as far as listing practices are concerned, which in its turn will help with how we treat witnesses in the courts.

When do you hope to have the conclusion of those inquiries?

(Mr Magee) I cannot speak for the Magistrates' Court Inspectorate report. I think some time later this year. As far as the information from the cracked and ineffective work that we have put in hand is concerned, again it will be later this year before results start to come through that we can act on. What we will then do is seek to engage with justices and chief executives in different areas to compare and contrast levels of performance and try to get underneath the figures and statistics.

What do you think is a realistic target to get the unnecessary attendance down?

(Mr Magee) I do not know. It is not all within our gift either. I think the targets that we have got are proving quite challenging to get down, and our first efforts must be to try and get there with the help of the sort of methods that I have explained to you.

(Sir Hayden Phillips) I think the recommendations in the White Paper, as they progressively come on stream, particularly in relation to tighter case management by judges and getting a grip on criminal cases earlier, as we have successfully done in the civil side, will over time make a real difference here, because if you get defence, prosecution and all the witnesses in advance of the trial to sign up to the key issues and a timetable which really does work and in which you get co-operation, then I think we should see quite a major change in the way things are done. That is the world we look forward to and, also, one in which the Lord Chief Justice can give practice directions about process not just in the High Court and the County Court but right through the totality of the criminal justice system, which he cannot at the moment - magistrates' courts are quite separate. I think in that way we can really make a much further advance, if we had those tools.

(Mr Magee) May I mention one more thing, which is quite exciting. In Essex, around Chelmsford and Basildon, we have introduced a scheme called XHIBIT which stands for eXchange of Hearing Information By Information Technology. That, for example, allows us to contact the different agencies in the justice system and give them a real-time update on what is happening in the Crown Court there. What we have found is that it has an interesting effect, due at least in part to the strong leadership that is given by the resident judge there, on all of the parties to a case, including the defence. This sort of system will only work and work well if everybody understands what is required of them and works towards it. So, again, it reinforces the points that Sir Hayden was making about case management and case control as an effective example of how one can use IT - I realise I am leaning on my chin talking about IT in any public sector environment - to effectively speed up the justice process, and to change behaviour in the justice process too.

Chairman: I think the mention of Essex calls for a visit from Mr Russell.

Bob Russell

Actually, Chairman, it was a general question. I am assuming that the closure of the magistrates' court programme is not going to be halted, let alone reversed. That leads us on to the quality and the location of the new super court. I wonder if I could ask Sir Hayden whether the PFI route is delivering quality new court buildings or is there a danger, by the very nature of a Private Finance Initiative to generate a profit, that corners are being cut in order that PFI companies can generate a bigger profit? What is the quality of the new court houses, both interior and exterior appearance?

(Sir Hayden Phillips) Speaking for courts that we are involved now in designing, Cambridge, Exeter, Bristol and Manchester, I can absolutely say that architectural quality and design quality has been built very well into those courts. I do not pretend to you that every single new-build court would necessarily meet the standards you and I might want, and there may be some risks in PFI, but there is no reason why - whether you are going through a Public Private Partnership route or a straightforward, normal public expenditure route - you cannot build design and architectural quality into the nature of the deal. It gets more complicated where we are not in direct charge - say, in the magistrates' courts - but it can be done and, frankly, the Lord Chancellor and I want our department to actually be recognised for taking this very seriously and trying to make sure that architecture and design quality is built in. It has a cost but it is very, very important. These are major civic buildings.

So there is no dumbing down?

(Sir Hayden Phillips) No. We have actually won an award from the Council for Architecture in a Built Environment (?) for our approach to the creation of new courts. We want to hang on to that award, and that is a clear commitment on the part of the department and of the Lord Chancellor.

Chairman

Can we turn to fees now? You have introduced individual case contracts in both civil and in criminal cases. Is that right?

(Sir Hayden Phillips) Yes.

The purpose of that is to remove incentives for delay.

(Sir Hayden Phillips) The central purpose of contracts is two-fold: it is, first of all, to make sure that you have a better grip on costs of cases and you are not simply reacting to people's bills and just having to pay them. The second purpose is to assure the users of the quality of the service that is being provided. In other words, in exchange for a contract the Legal Services Commission will check on and audit the quality of the service being provided. They are the central reasons, in general. There are particular types of classes of case - for example, very big cases - where we are introducing a specific contract for an individual case and which we pay as the case goes along, in agreement with those who are delivering it. That has the potential, although it brings money forward, in the long-term to reduce expenditure and certainly to reduce delay in relation to payments - so you do not find yourself, long after the event, arguing about how Legal Aid should be provided in a particular case. Obviously, we hope that that mechanism, as it builds up and is going quite well, will also assist us with the general problem of delay.

Have the lawyers signed up to this?

(Sir Hayden Phillips) Yes.

So you have not had difficulty finding lawyers to take on that work?

(Sir Hayden Phillips) No. I think it is right to say that across the country as a whole there are sufficient contracts. There are certainly sufficient contracts across the criminal system. We are a bit worried about the supply in relation to family cases and asylum in certain parts of the country, some rural and suburban areas. We have mentioned in our memorandum that there had been a drop, particularly I think in the family area. With the Legal Services Commission we have to keep a very close eye on that, not just for the short-term but for the longer term. One of the things we have done is to put some money - I think about £1.5 million - into training and development contracts into firms to encourage people to come into this sort of work so that we are continuing to build a long-term supply base in publicly-funded work. There are various other things that are being done as well. So the overall position is satisfactory, but with some spots of difficulty which we really have to watch.

You are getting value for money?

(Sir Hayden Phillips) I think we are in a position now, through contracting and quality assurance, to be able to give the Committee much more assurance about value for money than we would have been able to have done two or three years ago. Indeed, the Legal Services Commission is looking at that the whole time, and it would not, indeed, be giving out contracts to those people it did not think represented value for money.

The complaint used to be that the Legal Aid budget was going up and the number of cases being dealt with was going down. Is that no longer the case?

(Sir Hayden Phillips) The Legal Aid budget in relation to crime is going up, and I think it is right to say that 49 per cent of criminal Legal Aid goes on 1 per cent of cases - the most expensive and the most complex; the big, heavy serious fraud, or organised crime cases. That often is not clearly known. That is going up, and we would expect that to gradually go up; it is not something which is within our control. We are required, obviously, to fund the defence. In relation to civil provision, what we call the ----

Just to be clear: are you saying that criminal Legal Aid is now dealing with more cases?

(Sir Hayden Phillips) As to the number of cases, I may have to be assisted. I think it is certainly dealing with heavier and more complex cases, which I think is the main driver for the increase in costs. In relation to the Community Legal Service - ie, civil Legal Aid - it was £2 million below provision last year. In real terms it is now at the same level as it was in 1994/95. In other words, we have got much greater control over the budget, partly as a result of taking personal injury out and through CFAs coming in, and as a result of that we can target Legal Aid better than before. I think I am right in saying that 90 per cent of all new business in the last year was targeted on children, family cases, social welfare cases, immigration, housing, debt and education, which is where the Government really has wanted to see Legal Aid money going. So I think, in a small way, I would claim that is quite a success story compared to what was in place before.

And the lawyers are all co-operating?

(Sir Hayden Phillips) As the first non-lawyer Permanent Secretary of the department, I am surprised at how co-operative they are, yes.

You have not had to stuff their mouths with gold?

(Sir Hayden Phillips) No, we have not, actually. Indeed, we have held down rates. As you know, the Lord Chancellor has reduced the use of QCs in the criminal courts and there has been a substantial saving there. We have tended, where we are doing remuneration increases, to target those on the areas where we are shortest in terms of expertise. I forget the figure now, but the general increase in Legal Aid remuneration has been very low compared to increases in private remuneration, which is something we, again, have to watch because if the disparity is far too great there will be no incentive for a lot of solicitors, for example, to stay with publicly funded work.

You have abolished the means test for criminal Legal Aid, I believe.

(Sir Hayden Phillips) Yes.

Have you been able to quantify the effect of that?

(Sir Hayden Phillips) I can give you some figures. The numbers in terms of the money flowing through from what are now called "recovery of defence costs orders" is not that great, but the key thing was to do two things: one, it frankly was a waste of time and energy to go through this immensely complicated process, which on the whole was got wrong in a sufficient number of cases for the accounts of this department to be qualified every single year. That was just unnecessary and unacceptable. Secondly, it built into the magistrates' courts a period of delay while this work was done, which was much better used if it was not there at all. I think there has been a considerable improvement as a result of that.

So you have abolished a lot of bureaucracy, it has not cost an enormous amount of money and you have reduced delays.

(Sir Hayden Phillips) Yes.

(Ms Rowe) To date, 191 orders have been made against income and 65 made against capital. In relation to the orders made against income, they amount to £110,000 and the 65 against capital amount to £85,000.

Right. The main point, anyway, is not to get the money back, it is to get rid of the delay and bureaucracy. Is that right?

(Sir Hayden Phillips) Absolutely. Delay and totally unnecessary bureaucracy, which is a complete waste of time.

It has been a success. Good. Turning to the Criminal Justice Reserve Fund, has it worked in practice? Has it given you the flexibility you need?

(Sir Hayden Phillips) I think it has been a successful innovation. It has enabled us to be able to deal with new pressures that have arisen since any settlement has been made and it has enabled us to take some new initiatives. There are a number of examples I could give, Chairman.

Just one or two, yes, please.

(Sir Hayden Phillips) Well, if we take victims or witnesses, money has gone in to deal with increased help for vulnerable and intimidated witnesses and for extended witness support to the magistrates' courts. We receive money from the CJS Reserve for developing the criminal justice information technology in our own area and that now, as one of the results of the SR2002 settlement, is very large sums of money. Something like £600 million over three years will go into IT in the criminal justice system. We have been able to fund increased sitting days in the courts as a result of, as it were, more cases coming through from the police than we had originally anticipated and some money has gone from the CJS Reserve to the Street Crime Initiative which is now under way, so it has been quite a quick response mechanism for putting resources into new initiatives and new areas. It has also been good as it required three Ministers in charge of three departments to agree on the priority to give to it and that has been a discipline on all of us to make sure that we do actually work together and are choosing priorities that we share in common, so, on the whole, a good story and the fund will continue at, I think, £225 million a year over the three years from the beginning of next year.

That seems to be a rather large increase. I think the total allocation in 2001/02 was £85 million. Have I got that wrong?

(Ms Rowe) The total money available in 2001/02 was £100 million, but it was raised to £200 million in the current year and then to £225 million next year.

So what are you going to do with all the extra?

(Ms Rowe) Spend it.

Yes, I gathered that, but on what?

(Sir Hayden Phillips) It is extremely good, which Ms Rowe will tell you about.

(Ms Rowe) We will be continuing the funding from the current year. There is a very long list of outstanding claims which people wish to make against the Reserve for improvements in IT, further developments of witness facilities, more staff to help out with tackling delays, that sort of thing, so we actually have many more demands on it than can be met.

You have done rather well there, have you not?

(Sir Hayden Phillips) Yes, I think it has been a very useful exercise. It has enabled us to respond more quickly, having the resources, rather than saying that we cannot do something. It has also enabled us to try out new ways of doing things and let me give an example which I think is an extremely valid one. One of the things you really have to avoid is delays and to try to get all the players to come to court at the right time so you do not get adjournments is to have people working on case progression and tracking it through the system. Now, we have used money from the CJS Reserve to build up that capacity in the magistrates' courts and I think as we do that, along with the other things we mentioned, I hope you can see us continuing to tackle this problem of delay, so I think it has been a successful innovation both for reasons of additional resources, flexibility and innovation, and a real coming together by the three departments to concentrate on priorities.

The Home Secretary said the other day that in time we will integrate the management of all the courts into a single organisation. What are the implications of that for you, for your Department?

(Sir Hayden Phillips) Well, the implication is very significant because my Department will be responsible for the organisation that results from that integration. As I mentioned earlier, I think, Chairman, in answer to one of your initial questions, we shall be absorbing, for example, 10,000 staff from the magistrates' courts. All of this will require legislation obviously to create a new arrangement, but the plan is basically to be able to have a system which can set standards throughout the criminal courts in England and Wales, a mechanism to be able to reach down into the system to deal with those courts which are performing less well, which is quite difficult to do at the moment, and the performance varies quite widely across the country, but to couple that with what we would like to think will be a wider system of local accountability through management boards which will include consumers of services, magistrates, other local people, whereas at the moment the magistrates' courts' committees are not required to draw in the whole range of users of services, so we want to try to balance a national structure with a new system of local management boards which will bring in a much wider range of people and which will hold local managers to account, so that is the sort of structural change that we have in mind. Now, we have not set out a blueprint for precisely what this should be because we want to work that out by talking to those who are involved now on the ground, and that will take place over the next 18 months or so and, as I say, Ian Magee will be in charge of this very major project which is a massive change in the criminal justice system.

Over what period of time do you expect that to be carried out?

(Mr Magee) There are some big issues to settle, so it is going to take some time, but my guess, and it is a guess at the moment, is that I doubt that the new single agency could be introduced much before 2004/05. You can imagine the sort of issues from managerial structures through terms and conditions to ensuring critically that the local accountability that Sir Hayden referred to is actually captured so we get the proper balance between centre and local.

And have you got the money to do it in the recent CSR?

(Sir Hayden Phillips) We have money in the recent CSR. What we are having to do now, because obviously not everything was funded, is to sort out our priorities and see how much we can devote to this exercise and what that implies for the timetable and the pace of change, so I cannot give you a definitive answer to that question, but we shall certainly need to put some money into this, otherwise it will not work. It will take us, I think, until the early autumn to make decisions about the priorities across the Department in the light of the spending settlement we have had and I should not sort of prejudice that by saying anything else.

I saw an article in The Times the other day which suggested, well, the headline was, "Lack of money will delay justice reform for ten years", and it said that a key claim in the White Paper - I beg your pardon, this is about a radical shift in jailing minor offenders is unlikely to proceed for several years because of lack of funds. Sorry, I am jumping about a bit.

(Sir Hayden Phillips) Well, I think that was an interview with Lord Falconer.

It was, yes.

(Sir Hayden Phillips) In which he indicated that on the Home Office side, in terms of a range of things, he did not believe that every aspect of the White Paper was fully funded at the moment and, therefore, some things would take a very long time. I think it would be rather hazardous of me to comment on the Home Office's business.

Yes, I am sorry, I got the wrong end of the stick there, I think. You are satisfied, as far as the integration of courts is concerned, that you have got the funds to proceed with that?

(Sir Hayden Phillips) I am not satisfied that we have the funds to proceed as fast as we would want. What I am saying is we have got to do this. We need to sit down and look at the resources we have been given, some of which have been ring-fenced, particular things like information technology, and then see how much we can devote to the integration process and in the light of that, we will be able to let the Committee know much more about the timescale and the nature of the operation, but I am afraid we will not be able to let you know that until the autumn.

(Mr Magee) There are a number of things that we are getting on with now which, far from requiring money, have the potential to save some money. I have got, for example, in mind courts and utilisation. We have an active dialogue, a co-operative dialogue between the justices' chief executives and ourselves about how we can mutually make better use of the big estate that we have got between us and that is beginning to produce results. For example, later on this year in Manchester we will be able to continue to provide county court services by moving some county courts lock, stock and barrel into better accommodation in the magistrates' courts. My people are going around each of the 42 areas discussing with justices' chief executives where there is opportunity for us to make common cause. Another example might be procurement. There is a variety of procurement arrangements out there at the moment and we may just be able, and I do not want to give any hostage to fortune, but we may be able to generate some revenue by dint of a better approach to things.

Bob Russell

Coming back to the organisational and structural change, it strikes me that this is centralising, taking up to the centre rather than sending down to the grassroots. Is that a fair comment by me?

(Mr Magee) No, I do not think so actually, if I can be so bold. What we want to get is the best out of two organisations that are very different in their delivery systems at the moment. The notion of a central agency will allow us to set standards, as Sir Hayden was saying, it will allow us to intervene where we feel those standards and particularly performance standards will be met, but critically, and I think this is the real answer to your point, critically what we are doing is we are creating a single agency out of the two sets of organisations that exist at the moment by ensuring that we take the views of all of those who are responsible for local delivery of business and do not, on the contrary, impose something from the centre of Whitehall. I think that was made quite clear in Chapter 9 of the White Paper and that is the firm steer that I have in carrying forward this work.

Would you accept that rather more of the magistrates' courts' committees are of the view that perhaps this is centralising and they are going to lose their local autonomy?

(Mr Magee) Well, I do know that that view exists, but what I have always sought to do is to try to work with all shades of the spectrum and to try to make progress. Once the headlines are out of the way, "Central good, local bad", or "Local good, central bad", we get down to, "Well, let's talk about brass tacks here and how we can actually fulfil the policy intention which was set out in the White Paper on empowered local councils' and local communities' management boards, but with a centralised structure that enables that to happen". People have to earn flexibility locally because they do not get it automatically and that means having the pieces in place in order to earn that flexibility.

Chairman, I will put a marker down as I expect we shall return to this another day.

(Sir Hayden Phillips) Could I just add, if I may, Chairman, just a couple of comments. I do understand the concern, the absolute commitment to local justice, local delivery, that was absolutely there, and to the lay magistrates. One thing that comes shining through Robin Auld's Report and the White Paper is a very clear commitment to the lay magistrates which, you will be aware, people felt had been threatened two or three years ago and it is absolutely not the case. Local magistrates, 30,000 volunteers across the country, will be at the heart of this new arrangement. Secondly, what is interesting is that there is no requirement on magistrates' courts' committees to consult the court users, the local community or local authority about the management decisions they take. We intend to develop a structure which enables that to happen by, as I was saying earlier, a wider process of consultation and accountability locally, and I know your Committee will watch this space and make sure that what I am saying is carried through. At the same time there will be very considerable advantages in being able to have this happen within a national structure and, in particular, as I mentioned earlier, because at the moment there are procedural differences in the courts which are unnecessary and you can have a single procedural code which runs right through which enables there to be consistency between the different tiers of the justice system, and I know that we are going to set up statutory criminal procedure rules whose writ will run right through the system, and I know the Lord Chief Justice wants to get on with that work administratively. So that is the sort of balance we shall try to strike throughout this process of consultation.

Chairman

Going back on a theme, one of the complaints of lawyers is that it took a very long time for them to get paid, their legal aid. Was there any justice in that? I rather think there was, was there not, and is it still the case?

(Sir Hayden Phillips) Yes, there was justice in it and when you are dealing with so many payments ex post facto you get yourself in a position where delay increases. I think the position has considerably improved by having standard fees in magistrates' courts, by having standard graduated fees for cases, I think, up to 25 days elsewhere and of course in the very heavy cases this is no longer a problem because, as I say, we are doing individual contracts and people are paid as the case develops, so I think in that respect the cash is more quickly in their hands and that is something that has been satisfactorily improved. There may be still some problems in some areas where the after-the-event payment system takes place, but we are reviewing those and I think what we want to try to do is put in place arrangements which encourage better case preparation, so we are tilting the fees towards getting the work done well in advance and, in return for that, trying to pay people more quickly. It will be a new development and I hope we can welcome that and do that reasonably well.

David Winnick

The Home Office has a target, as you know, of moving some 30,000 failed asylum-seekers a year, and that is the Home Office side of the equation. Do you expect that that target will be reached or anywhere near it which would discourage people from appealing where there is not a great deal of merit?

(Sir Hayden Phillips) Yes, I think common sense indicates that must be the case.

So you are pretty optimistic that the number of immigration appeals will decline?

(Sir Hayden Phillips) No, not necessarily because what this turns on, and I am following the logic of the question, is on the number of removals reaching a level at which people say to themselves, "I have a manifestly unfounded claim. There is no point in my going on through the system because the system is going to decide against me", so I am not suggesting that there will be a decline in appeals necessarily, though I would hope that would be the case, but I think the Home Office would acknowledge that they are still quite a way from trying to meet that removals target.

Perhaps your answer to some extent reflects a certain reserve as to how far the Home Office will be able to achieve its target, or is that an unfair question?

(Sir Hayden Phillips) I think I had better make no further comment on that. I think you may have asked these questions of my colleague and I had better not give an answer different from his.

There are going to be, arising from legislation, certain categories of asylum-seeker cases being heard from abroad. Could you give any details about that?

(Sir Hayden Phillips) The provisions in the Bill going through the House now. I think there are two things at the moment. I cannot give a definitive view, I am afraid, because you have to make a series of assumptions about how many such cases there will be before you know quite what the consequences are. We obviously have experience of handling appeals from abroad, visa cases, so it is not, as it were, a new development from the point of view of the appellate structure. What I am not clear about myself and I am not sure that my advisers are either yet is what the number of such cases would be because our particular concern would be to ensure that we were resourced to be able to handle these adequately if Parliament approves these powers, and it is quite difficult for me to comment on something which is still going through Parliament on which we have yet fully to bottom out with the Home Office what assumptions they are making about the number of such cases.

In fact, as you indicated, the system is such that when someone is refused permission to come to Britain, be it for permanent settlement or for a visit, the appeals are heard in the United Kingdom in the absence of the appellant. That was the system from the very beginning, from the 1970s. Is that not right?

(Sir Hayden Phillips) Yes, that is right.

Are you of the view that if what is now going through Parliament is brought into effect, hearing cases of asylum from abroad would lead to much saving as far as cost and other related measures are concerned?

(Sir Hayden Phillips) It entirely depends, I think, on the number of cases which arise and this is a Home Office area, but clearly you have got to return people to a country which is safe from that point of view and that, therefore, needs to be assessed and you need to look very carefully at the sort of categories of case that this would apply to. I assume it applies to cases which the Home Office would certify, using the old language, as 'manifestly unfounded' and coupled with the fact that they would have to be sent back to a safe country, a safe country of origin or a safe third country and that you had the co-operation of the authorities there, so there are a number of variables which need to be sorted out. I think the only area which would concern me, and it is very difficult again to be precise about numbers here, was that if an appeal from abroad failed, I believe there would be a route for the judicial review of that decision and if the numbers were very high, we would be putting pressure on the High Court which could be a particular demand which was quite difficult to meet, but, as I say, this is not firm territory yet, Mr Winnick, I am afraid, so I cannot really go much further than I am at the moment.

It is all a very sensitive area. One person only has to be denied asylum and be persecuted in such a manner that he or she could lose their lives for the whole system to be brought into discredit.

(Sir Hayden Phillips) Well, I agree with you, but, as I say, these are essentially matters for the Home Secretary.

As regards advisory services in the private sector, there is now a form of registration. Am I not right?

(Sir Hayden Phillips) Yes, and there is a commission which, as it were, inspects and makes sure that the quality of services in relation to immigration is adequate and that people are not able, as it were, to give poor advice to clients in this area.

What about solicitors? There has been some criticism of them, has there not?

(Sir Hayden Phillips) More widely there have been real problems in handling complaints against solicitors. The performance of the Office of Supervision of Solicitors has not been satisfactory both in terms of quality and in terms of turn-around times.

Chairman: I think we are going to come to that later.

David Winnick

I was dealing with the immigration aspect, but, as the Chairman says, we will come on to that.

(Sir Hayden Phillips) I think there have been concerns in the past, but I think the new office of the Immigration Services Commission is now working well and there is better and more effective regulation. It does draw us into the generic issue of complaints and that is the trouble, to see whether they are being handled well, but I think I cannot offer you any more than that at the moment.

Mr Cameron

My apologies for being late. Sir Hayden, I was wondering, people who appeal from abroad, will they be able to claim legal aid?

(Sir Hayden Phillips) Yes, as far as I know, I think they will be. I will have to check that absolutely.

My understanding is that they will be able to. Do you have a concern, as Principal Accounting Officer for the Department, that this is a good use of public money if the Home Secretary has decided they have no foundation for an asylum claim and they return to a safe country?

(Sir Hayden Phillips) Were they to be here, as they are now, they would be entitled to claim legal aid and I think it is very difficult to argue in human rights terms and the rest that they should be denied it, so I do not think, as Accounting Officer, I have a problem with that. That seems to me much an issue of policy and if Parliament endorses it, then I think, as Accounting Officer, I am in a reasonably solid position.

In terms of asylum targets, your own asylum target on page 78 of your annual report is to reduce the waiting times for asylum appeals from 36 weeks to 17 weeks and that has now been dropped, that target? Is that right?

(Sir Hayden Phillips) We now have an overall target which we share with the Home Office and the target now is for appeals, 65 per cent of appeals through both tiers of the system to go through in four months, or 17 weeks.

What is the target for the other 35 per cent of cases?

(Sir Hayden Phillips) Well, we have tried to set a target that, as it were, deals with the totality in terms of numbers we can get. There will always be target cases that take much longer.

It does not really deal with the totality if more than a third of cases do not have a target attached to them. That just drifts on.

(Sir Hayden Phillips) That is an average. It applies to all the cases. In other words, we would actually tackle the whole system on the basis that we would try to push them through as fast as possible, but our experience of the longer and more complicated cases leads us to believe that a reasonable target is about 65 per cent.

But it is not an average target on what you are saying because 65 per cent will be dealt with within 17 weeks and the other ones, yes, they are more difficult, but why not have a target for them? It is just as if a third have been dropped out of the total in terms of having a target for them.

(Sir Hayden Phillips) You could do that if you could identify at the start of a case what their characteristic was in such sufficient terms to be able to set targets for different categories of case. As far as I know, we have not been able do that, hence we have this average target across the board. I do not know, Ian, if you want to comment, but I think that is my understanding. I am not trying to avoid the question.

Mr Cameron: No, but my worry with these targets is that I fear that the Government sets them, there is a blaze of publicity, "Isn't it marvellous the Department is getting on with it!" and then quietly they are amended, dropped, changed and large parts fall out of the system and that is what we are here to check up on.

Chairman: Well, we are, Mr Cameron, but you were not here.

Mr Cameron: Yes, and I knew you would pull me up if we had gone over any of this ground already.

Chairman

Perhaps Sir Hayden wants to respond briefly to that point.

(Sir Hayden Phillips) We had a longish discussion. The position I was saying I have taken on this is that I am sympathetic to your point of view and I think that the complexity of the subject and the fact that they move around a lot is not a good thing. Secondly, we have with the Treasury agreed to focus on a much smaller number of targets and, thirdly, whilst we can give no guarantees that targets will not be changed because they change in reality, what we do want to see is a more consistent pursuit of targets that have been firmed up and settled. I agree that that is our position in relation to targets in the immigration area as well as the targets across the board.

Mr Cameron

It says here that you are not going to meet this amended, easier target of 65 per cent of cases, that it cannot be measured until the end of July 2002, and we are nearly there, but it is unlikely to be met. Why are we not going to meet it?

(Sir Hayden Phillips) Because it is a very, very demanding target. The numbers of appeal determinations increased by 75 per cent between the year before last and last year, so you are talking of a massive increase in jurisdiction and people having to do a lot more detailed work. Secondly, the number of cases coming through per month is moving from 4,000, roughly 4,500 now, to 6,000 in November and, therefore, the target will be even harder to reach. My own personal view is that we have really got to have another look at this and make sure ----

And change it again?

(Sir Hayden Phillips) No, not necessarily change it again.

It does say here that the target contains LCD, SDA targets for the year 2002/03 onwards, slightly modified, but it does not say how.

(Sir Hayden Phillips) No, but there is maybe a minor change change there, but I am not saying we are going to change it. What I am saying is that if it turned out that the target really was completely unrealistic, then I think it would be right to change it and to explain that change to Parliament and to come to the Committee and say why that was the case. In order to raise our game to 6,000 a month, I think I am right in saying that we need another something like £66 million to be spent on more judiciary, more administration, more IT, plus a whole raft of things, which I will not go into detail on, of changes in process and how the work is done in order to hold the present position. I think this is a very difficult area in a jurisdiction which has grown larger than any legal jurisdiction in this country over a very, very long period of time.

David Winnick

Does not Mr Cameron's question to you, Sir Hayden, indicate what I asked earlier, that where there is little or no merit insofar as those cases are discouraged, and perhaps not just little, but absolutely no merit at all, then of course to that extent one would hope that the system is such that that might be improved and appeals could be heard pretty briskly, which is what people want?

(Sir Hayden Phillips) The more you can push what I call the 'manifestly unfounded' cases through the system quickly, that will have a considerable advantage overall, but it is interesting that the number of such cases that were coming through two years ago was, I think, something of the order of 36 per cent of cases and that has fallen quite markedly to about 21 per cent of cases, indicating a judgment that it was not as easy as it had been to certify cases as manifestly unfounded. This followed a court ruling, the name of which I forget, which said basically that those making the decision had to be satisfied that every single element of a case was manifestly unfounded rather than on balance, taking it all together, that was so, and that was a very demanding test, so we have actually now got in the system less a percentage of such relatively uncomplicated cases than before and that has made our task a bit more difficult.

Chairman

When these appellants are submitting their appeals from abroad, you will have not have to send a lot of lawyers to the Middle East or elsewhere to interview their clients at public expense?

(Sir Hayden Phillips) I am hoping not. Then I think Mr Cameron's question to me as Accounting Officer would have some bite.

Mr Cameron

Chairman, may I pursue this? If people are going to be able to appeal, how can they prepare their appeal if they do not have access to lawyers?

(Sir Hayden Phillips) Well, they will have access. What I am trying to deal with is the suggestion that, as it were, the flights to various parts of the world will be full of lawyers going backwards and forwards at public expense, to which I am saying I hope that that is not the situation which would arise, that other means of giving advice can be found.

But in order to prepare a case properly, surely they have to have a face-to-face contact? You cannot do it all by e-mail and telephone, can you?

(Mr Magee) I cannot be certain about this and we may have to check our facts here, but I think, for example, we have used video links successfully to deal with some proportion of these sorts of cases already. What our concern is is obviously to ensure that we do not incur the sort of gratuitous cost you are implying.

(Sir Hayden Phillips) As I understand it, and I hope it is right and I will correct it to the Committee if I am wrong, people of course have arrived here and they will be interviewed and be able to have access to a lawyer when they are here before they are sent away, so it is not as though there will be, as it were, no face-to-face opportunity to have a look at the case individually. After that clearly if there needs to be regular communication and further preparation, we are going to have to find some economical ways of doing that.

David Winnick

But the advisory service will be available surely to those seeking to lodge an appeal from abroad?

(Sir Hayden Phillips) Yes, as far as I know.

The advisory service, publicly funded?

(Sir Hayden Phillips) Yes.

That is your understanding?

(Sir Hayden Phillips) That is my understanding, yes.

Chairman: Now we move to the Libra project.

Bridget Prentice

Just about two months ago, the Lord Chancellor said that the discussions with Fujitsu "will be concluded shortly". Are they yet concluded?

(Sir Hayden Phillips) No, they are not, I am afraid, yet concluded. We are still negotiating with them about the existing contract and I hope they will be concluded very, very shortly, but I am afraid I am not in a position to announce that to the Committee today.

Bridget Prentice: How shortly is "very, very shortly"?

Chairman

When the five tests are met!

(Sir Hayden Phillips) We are aiming to try to complete this before the summer recess. Now, that either means by Wednesday lunchtime or, if you take the House of Lords, it gives me a bit more time until the middle of next week. We are, I hope, close to a decision here, but I am afraid I cannot answer the question precisely today.

Bridget Prentice

We shall look forward to that. Presumably when those discussions are concluded, you will announce that immediately or as near to immediately, some time thereafter.

(Sir Hayden Phillips) We will announce it straightaway. I will write to the Chairman, as it were, just before the announcement is made, whenever it is, and I will do the same if it has to be made when the House of Lords is sitting and the House of Commons is not sitting and if we slip beyond that, I would obviously let the Chairman know the moment that the announcement is made.

What has the effect of Libra been on other projects on linking up IT in the courts system?

(Sir Hayden Phillips) Perhaps I can ask Ian to comment.

(Mr Magee) This is facts, not contract negotiations, so I can speak to this, that the first part of the Libra contract was to roll out an infrastructure the magistrates' courts did not have and that job is 75 per cent completed now to evidently, judging by the levels of complaints having eased off, a high standard. This is the provision not only of PCs, servers, et cetera, but also of networks to support all of that and help-desk, et cetera, facilities. I do not think that the renegotiation of the Libra contract, which is what this is about, has had any detrimental effect at all on IT and the rest of the criminal justice system. The effects have solely been, important though, on the magistrates' courts community and they would have been worse if we had not managed to roll out, for example, e-mail as we have been as part of the infrastructure.

Do you think that you will treat future projects differently as a result of your experience with Libra?

(Sir Hayden Phillips) Yes, I think you learn from all these projects where they do not turn out totally satisfactorily on either side. I think departments generally have to think about when they are working with suppliers what they are best at doing and concentrate on using their major skills rather than necessarily having an arrangement in which you assume that any particular company can do every aspect of every project. That is what we are now negotiating with Fujitsu about, so I should not say any more, but we will certainly learn the lessons from this and what I would be very happy to do, in addition to letting the Chairman know when an announcement is made, is letting the Committee have a note, when we have reflected on those lessons, about what we think we have learnt from the process and how we would deal with future contracts.

(Mr Magee) What it has done is to bring together in one place in the Department through me responsibility for virtually all of the IT issues that affect the totality of the court work and the other tribunals for which the Lord Chancellor is responsible. What I do in turn is work very closely now with the recently appointed Head of Criminal Justice IT in the Home Office as far as the criminal justice side of how we intend to improve progress.

The Home Office have not been examples of best IT projects either, have they?

(Mr Magee) Might not "have been". I think it is a question of tense rather than where we all intend to get for the future.

I do not wish to jeopardise your discussions with Fujitsu, but are there penalty clauses attached to these contracts?

(Mr Magee) Yes.

Is that standard?

(Mr Magee) It is standard. You are beginning to get into the area of potential negotiations.

I am keen that next week's announcement will actually take place.

(Sir Hayden Phillips) Or this week's announcement.

Or this week's, even better. If I may move on to CAFCASS, that had in its birth a number of problems and when the Lord Chancellor came to the Committee in October, he said that there were still some problems there. What lessons do you think you have learnt from the setting up of CAFCASS?

(Sir Hayden Phillips) First of all, when you are making a major reorganisation, you really do have to give yourself time to implement it and we did not give ourselves, I think, enough time. The timetable was rather driven by the creation of the National Probation Service and I think had we been given more time, we would not have had some of the teething problems that we had. When you set up a new organisation of three different component organisations, you have to give yourself the time to create a new central structure to manage all that. That had to be done alongside trying to run the system and of course, as I think you know, the organisation was, as it were, badly deflecting from what we wanted it to concentrate on by an industrial relations dispute lasting for a very large part of last year and into early this year which has now fortunately been settled, but the combination of those factors made it a difficult start. However, having said that, the Magistrates' Court Service Inspectorate inspected CAFCASS in the last, I think, three months of last year and said that, generally speaking, the services that were actually being delivered on the ground had not suffered as a result of the change compared to the level and the quality from before. What we are now at the moment concerned about, to be absolutely frank with the Committee, is that we are able to tackle backlogs of cases and delays in allocating cases that are building up in London, in the north-east and a little bit in the south-west and trying to make sure that we are able to boost the number of staff, whether employed or self-employed, over a reasonably quick period. I think also the other thing we have to do, and when I say "we", I mean the CAFCASS Board which is an NDPB, not a part of the Department, is to try to develop training programmes so that specialists in private law children's cases can switch to public law care cases and vice versa to give us greater flexibility in the allocation of cases to the guardians. So it has been through a difficult period, has been stabilised to some extent, but there is more work to be done in terms of trying to tackle some of the delays and backlogs in certain parts of he country.

Apart from the backlogs and delays, what are the key factors which would need to be met before you are satisfied that CAFCASS is working in providing the kind of services you want it to provide?

(Sir Hayden Phillips) I think the publication and settlement of national standards of performance, consulted on, that they did in May, and they hope to come to conclusions this summer, during July and August, having in place a clear and well-understood and well-working complaints procedure, and there is an interim process at the moment, further improvement in information technology, although the initial investments have not proved too bad, and I think above all being able to put behind the organisation the industrial relations and staffing problems which are now largely over and really concentrating on the work with children and getting that much more as a headline message for the whole organisation. Can I revert back to something which Ian mentioned earlier which was about the delays in family cases. To be frank with the Committee, if there is an area that does worry us, it is this family area and I would need a concerted attempt on improvements to CAFCASS, which is very important for the children in the case, through the court system to try to speed up the cases which take far too long and through the judiciary, through the President of the Family Division, making sure that the right judges are allocated to the cases, that they are well qualified, they do quite a bit of family work, and that the whole system is put together in a satisfactory way. I think this is an area on which we must concentrate harder for the future.

You say "the right judges allocated to the cases", so are there cases of wrong judges being allocated?

(Sir Hayden Phillips) Well, not wrong in the sense of, "Gosh, we shouldn't have had this chap. He was simply awful", or, "This woman, she was absolutely no good", but I think what I am referring to here is the way in which in the past the allocation of specialist tickets to do this sort of work has not been totally satisfactory in the view of the President of the Family Division and she wants to review the whole of the way that that is done to make sure there is a stronger role for family liaison judges across the country and it is run much more like the way in which the judicial role is run in relation to the criminal courts through the senior presiding judge and the presiders who give a clear sense of direction and make sure that there is a regular review of the extent to which judges in these areas are actually having experience of these cases rather than doing them only intermittently and also taking up all the training that is regularly required to keep people up to speed.

You said earlier that we all learn from past experience. In setting up CAFCASS and with its immediate problems, how much did the Department learn from the Public Trust Office?

(Sir Hayden Phillips) I think they were quite different animals in a sense. The setting up of CAFCASS was the creation of a wholly new organisation from different component parts. As I say, I think my to principal concerns there were the amount of time that was given to people to do it and the fact that it then happened to be hit by an industrial relations dispute. In relation to the old Public Trust Office, I think there is an example of an organisation which had gone along in the same way for a very long period of time which I do not believe the Department paid sufficient attention to and which had, as it were, got itself into a position in which its ways of working and the standards it had set were just not up to the right quality, which was why we made the change there to a quite different sort or organisation, quite different problem, which was not the creation of something wholly new, but the revitalisation of something which had become rather moribund, so I do not think there is a sort of direct read-across between the two types of case.

But there were problems in terms of industrial relations and staff morale, so was there not something there which may have alerted you to potential problems?

(Sir Hayden Phillips) The main thing that alerted me to potential problems there was the fact that we are back to our old friend, targets. There were certain targets for the PTO. They regularly met and they did not appear not to meet them, but they did not really tell you about the real nature of the business and what was going on underneath. Once one realised in fact that the level of service was not terribly satisfactory, despite what the targets told you, then it was quite clear that changes had to be made. There were staff morale problems once we announced that we were not satisfied with the PTO and we were going to create a new organisation out of it. I think a lot of staff felt they were being unfairly criticised and singled out. There were other staff morale problems when it was quite clear that we could no longer afford to stay and have a central London location in the Kingsway and we moved to Archway, but again I do not think there was a precise read-across between the two situations.

But both organisations were dealing with vulnerable people who in effect are not able to speak for themselves because they are mentally ill or they are young children.

(Sir Hayden Phillips) I absolutely accept that and I think the main feature where I do think we do draw a common lesson is that in these areas what is called 'client services', the customer focus that you have, has got to be of really high quality and that is the area where currently I would want to place the greatest emphasis both for CAFCASS and for what is now the Public Guardianship Office. On the other hand, mentioning the PTO, it has in two areas the two actions which were most criticised when I appeared before the PAC some while ago, it has made great strides. They had fallen behind in collecting accounts from receivers, they had fallen behind in reviewing those accounts, and they have made massive strides in improving that. There were far too few visits undertaken to the vulnerable and their receivers and that has been massively changed and in the last year I think something like 6,000 visits were undertaken which was, I think, a tripling of the amount of close contact there had been with clients, so there are some very good features, but at the moment in the PGO rather as CAFCASS there are backlogs that may lead to complaints, and you spend your time dealing with complaints rather than dealing well with the client in the first place, so in that respect we are looking at the organisation and similar problems now and we want to try and tackle them in a sensible way.

You have mentioned the business of complaints a couple of times in your responses. Tell us a little bit more about how these complaints have been dealt with in CAFCASS and have there been more complaints as time goes on or is there a steady stream?

(Sir Hayden Phillips) I do not, I am afraid, have the statistics for complaints on CAFCASS with me or in my head. I mentioned earlier that I think they have an interim system in at the moment and I think we want to make that a full system. The number of complaints in relation to the PGO has risen and I think Ian Magee would agree, as someone who deals with this sort of area on his side, that the number and nature of complaints is a very good and helpful indicator of the quality of the service, and you really need to take it seriously in looking to see why things are going wrong. What usually goes wrong is the initial contact that people make with the organisation and delays at that stage and the real answer is not necessarily to have a superb complaints procedure, although so you should, but getting the job right the first time. That might be something Ian wants to comment on.

(Mr Magee) Well, to the extent that I do not think that I have got it right yet in the core services, it is an area we are giving attention to at the moment, but actually we are learning from mistakes that are made, getting it right first time, cutting out all that gratuitous process that you get when you have to correct errors which is something that I think every organisation needs to do in this day and age, public or private.

Could you perhaps send us a note on complaints in CAFCASS and what has been done to correct that?

(Sir Hayden Phillips) Absolutely, yes, I will.

Mr Cameron

Could you address in that letter whether you think the complaints procedure needs to be in some way independent of CAFCASS? You talk of welfare officers having a very important role and if they get it wrong, I am sure we have all had constituency cases where when our constituents are told they have got it wrong, there is a sense of frustration from the constituent that there is no one to complain to, apart from the sort of line manager of the court welfare officer within CAFCASS.

(Sir Hayden Phillips) I will certainly set that out and deal with the issue of internal versus independent supervision and, as it were, an appeal process. As I mentioned, CAFCASS is inspected by the Magistrates' Court Services Inspectorate and certainly one of the things I can ask them to look at is their complaints procedure, but I know your concern is with the individual complaint rather than the system. I will certainly cover that as well.

Mr Singh

Sir Hayden, how concerned are you about the large number of solicitors firms unwilling to take publicly-funded work?

(Sir Hayden Phillips) In most areas of the law there are sufficient lawyers who provide publicly-funded services. That is the first point. In the supplementary memorandum we gave you, we indicated that there had been a drop.

Of 6 per cent.

(Sir Hayden Phillips) Of 6 per cent, yes. They are mostly, as I understand it, in the field of family advice, possibly some in asylum. We are concerned that we watch those gaps very carefully and where we can try to plug them. For example, over the last couple of previous years we have put more money into some family work and into asylum work in parts of the country where there were shortages. In asylum it has been a problem of expanding demand and trying to catch up with that. As I briefly mentioned earlier, I think this is both a short-term concern but also more fundamentally we want to try to make sure that public funded work is sufficiently attractive for people to come into it, which is why we have taken one step which is to put £1.5 million into tuition fees and training contracts to encourage firms to take on more people who will work in these areas and that is something which I think is valuable. There have been some enhancements to the remuneration particularly in what I am told is advanced family law work. Beyond that we have to look to see whether the problems do continue.

Is there any threat to the provision of community legal partnerships across the country?

(Sir Hayden Phillips) No. I think that on the whole in relation to those we have been very pleased with the way it has worked. Ninety-nine per cent of the country has now got a community legal service partnership which I think if you had asked me three years ago when we began this campaign I would have said I thought was a very over-ambitious target but it has been very successful. The process of linking up different providers, public, private, voluntary, has produced, I think, a signposting system for where people can get information about solving their legal disputes and legal problems in a way which was just not there before. That is enormously encouraging. The supply generally in most areas of the law from publicly funded lawyers is good but there are some spots of difficulty which we are trying to tackle. I think that is the overall picture.

Following the spending review have you any plans to increase the fees for publicly funded work?

(Sir Hayden Phillips) I would love to be able to answer that question but the Lord Chancellor has not taken decisions about that and I think that I would be pushing my luck if I was to say either yes or no because frankly we have got to have a look at that as part of both the SR2002 decisions on priorities and as a part of trying to tackle some of the gaps that are emerging and the frailty of some bits in the supply network.

Could we go on to criminal legal aid which you have touched on before. You did talk about the Recovery of Defence Costs Orders before and I was surprised by the statement you made in saying that it was not all about the recovery of public money. I am quite surprised by my brief in that I do not understand how this operates. My brief tells me that in 2001-02 the Special Investigations Unit accepted 809 referrals from the Crown Court. Of these, 632 cases required full investigation. Investigations were concluded in 292 cases and reports submitted back to the courts. The Crown Court made 22 RDCOs. That seems to me an awful lot of work for very little outcome or output and it raised £141,000-odd. How much has all that administration cost? If so little is being produced, why are we bothering?

(Sir Hayden Phillips) Why are we bothering? We are bothering because I think we should clearly make an effort, the question is proportionate effort, to recover costs at the end of the day from those who can genuinely contribute to them. I have to say I cannot immediately answer the question what the administration cost against the recovery rate was but, if I may, I will get a note sent in that deals with that unless one of my colleagues knows it offhand.

Do you not think it is a pretty poor show that out of all this work only 22 Orders were made?

(Sir Hayden Phillips) The figures as up-to-date as we have them from April 2001 onwards, ie roughly just over a year ago, are 193 Orders against income and 66 against capital. I do not know what our expectations or projections were, I imagine it was too difficult to do that. This was a total of something just over £200,000. Perhaps I could just repeat something I said earlier, if I may. Clearly we will have a look at the administration costs and address your point about proportionality, although I think people would say that those who really can pay should contribute something. The comparison was that I think on the means testing that went on before an enormous effort was put in and I think I am right in saying that payments were only made in one per cent of the totality of all the criminal cases going through the courts. That was wholly disproportionate - wholly disproportionate. As I say, it ended up with our accounts being qualified every year because people made mistakes regularly and, secondly, it built in a delay that was totally unnecessary. As I said earlier, I think that was a waste of time. I am sure this is a better system than that but I am afraid I do not have the information about the costs at the moment that I can give you to set against the income. That may not be the only issue because I think there will be a strong feeling among many people that if someone is convicted who does have means and can pay towards the cost of the case it would be right from the taxpayer's point of view that they should make a contribution.

I think the public would entirely agree with that.

(Ms Rowe) In fact we are reviewing the operation of the Orders at the moment. Internal auditors are involved in that and they will produce advice on how the scheme is working and if it can be made to work better.

Sir Hayden, you did say earlier that one per cent of cases are taking 49 per cent of the criminal legal aid budget. I think the public would like to see recovery of costs from drug traffickers, people traffickers, people engaged in smuggling. Why are we not doing more in that field through these Orders?

(Sir Hayden Phillips) I entirely agree with that. It is possible to freeze people's assets, it is possible to get contributions in principle here, but you have to be able to have the evidence that you can display and it is convincing and you have to be able to get your hands on their goods or their money. This will be done where it can be done but from the numbers we have given you here we have not had that very many very high cost serious cases in which very large sums have yet been able to be achieved. It would be our policy to do exactly what you say.

I think we would like to hear an assurance, or reassurance, that there is a will to do this.

(Sir Hayden Phillips) There is a will to do that. This is a combination of, as it were, our operations and Home Office policy. Again, if it is helpful, because I cannot answer for the Home Office aspects on this, I could put together a note agreed with them about what the powers are, what we can do, and illustrations of the sort of cases which on the face of it we might have wanted to have got some more out of the system but the reasons why we may not have been able to do so.

Chairman

It would be helpful as well to know how much it cost to get back this £141,000. You have already agreed to do that, have you?

(Sir Hayden Phillips) Yes. I hope I said that is something we will certainly give you so you can look at the proportionate figures.

We appreciate that it is early days and this has only been up and running since April 2001, so there is some way to go.

(Sir Hayden Phillips) Absolutely.

Mr Singh

Changing the subject slightly. We are running fixed contracts for low cost cases and there is a pilot running for high cost cases but are there any plans to extend fixed contracts to the higher cost cases?

(Sir Hayden Phillips) We would like to be able to push that further. The fixed cost regime and the standard fees regime have been quite successful in controlling cost and also, as we were saying earlier, lawyers knowing exactly where they were and not having to wait until after the event. As usual with these schemes to roll them out means bringing cash up front until you get to a steady state and I am afraid it is really a question of looking to see how much resources we can put into this as opposed to other priorities to see over what timescale we should do it. The information I have indicates that where we have contracts in the very high cost cases that is proving a successful way of managing them, both in keeping costs down and keeping a control over the quality of the work that is done.

Mr Singh: Turning to complaints against solicitors, you were interrupted when I thought you were getting to a very interesting part of your statement. I think you were saying that you were very happy with the operation of the Office for Supervision of Solicitors and its performance so far.

Chairman

I do not think he was.

(Ms Rowe) I think I was saying precisely the opposite. Obviously I have lost my powers of explanation this morning and I do apologise if that is so.

Mr Singh

My question is that we as Members of Parliament and certainly many of our constituents are not happy with the way it operates. Can you justify your confidence in the Office for Supervision of Solicitors?

(Sir Hayden Phillips) Let me make clear what our position is and this is what the Lord Chancellor has said. We are not happy with its performance. We have asked for a whole series of improvements to be made in turnround times for dealing with complaints and in the quality of the way in which they have been dealt with. We have set a whole range of targets, again, covering a range of activities and they are not hitting those targets, they are below them, and that is not good enough. In addition to that we have asked the Legal Services Ombudsman to keep a very close eye on the Office for Supervision of Solicitors and complaints handling and that she is doing and she is doing that successfully. The Lord Chancellor has taken powers in the Access to Justice Act if he thought it was useful and right to actually put in a Complaints Commissioner on top of this exercise. He has not at the moment decided to do that, but to try to enable the Ombudsman working with the OSS to make an improvement. On the other hand, to be fair, I should say that the Law Society have put in place a new redress scheme. They have announced the setting up of a lay commissioner, an independent lay commissioner. Sir Stephen Lander takes on this job in November. I know they genuinely want to try to improve the position. It is not coming through at the moment and I have to say there is quite a long way for them to go before they would satisfy us, and you as Members of Parliament, that complaints were being handled in the way we want.

Chairman

Maybe Sir Stephen Lander is going to tape their telephones and find out whether ----

(Sir Hayden Phillips) I think he has a range of qualities, Chairman, and he has not been selected for that particular experience.

David Winnick

The Office of the Immigration Service Commission in his annual report ---- Do you have that?

(Sir Hayden Phillips) Please.

He made criticism of some solicitors because apparently advisers in the immigration field who have not been registered in some instances, according to the Commissioner, and I am looking at the annual report, having failed to obtain registration, were incorporated in the solicitor's practice and yet operate independently of the solicitor. In other words, the solicitor, knowing full well that the immigration adviser had not been approved for registration, was quite willing to allow such a person to operate within the solicitor's practice and the Commissioner, understandably, was very critical of that. Is this too recent for you to comment?

(Sir Hayden Phillips) I think the annual report is published today. I have not, I am afraid, settled down to it in detail. If that is happening then obviously with the Commissioner we need to look at ways in which it can be made to stop happening because the good regulation which he is meant to ensure in this area has got to make sure that there are not shades of grey about whether people are properly qualified or not properly qualified.

It is a very serious complaint, it is obviously unprofessional conduct as the Commissioner points out, but it is unfair really to expect you to give an off-the-cuff response other than you have. I wonder if you would be good enough, with the Chairman's agreement, to send us a note about this and what action is intended to be taken by the Lord Chancellor if he considers that this merits an investigation.

(Sir Hayden Phillips) I will certainly do that.

David Winnick: Thank you.

Chairman: Now, we are in the miscellaneous section. Mr Cameron, do you have any further questions?

Mr Cameron

Yes. I am afraid they are rather miscellaneous. Just on the Office for Supervision of Solicitors, they are in the last chance saloon the Lord Chancellor has said, although not in those terms. How long have they got before you threaten some sort of statutory regulation? Have you put a timetable on it?

(Sir Hayden Phillips) No. I think the Lord Chancellor has made it clear that he keeps that option in mind. Self-regulation is a privilege, not a right. We believe they should be given a chance to put in the new redress scheme and the lay commissioner. We believe that the Legal Services Ombudsman should be given a chance to do the work she is doing with them to see if it can be improved. As I said earlier, he has the power to put in a new Complaints Commissioner if that is the right route, but equally it may well be that we ought overall to review the way that regulation works more widely in this area and that is something we should take into account.

Turning to public spending, I just have a couple of questions on page 94 on your public spending charts. You describe particularly in the area of asylum appeals a huge volume of work and I just wondered whether you wanted to comment on the fact that your estimate outturn for 2001-02 of 2.8 billion is actually more than your plans for two years' time. It seems that your budget is going backwards. Will you be able to complete the work with that budget or does the CSR change that fundamentally?

(Ms Rowe) There are some changes as a result of the spending review but also in 2001-02 we did receive additional funds from the Treasury for asylum and immigration work. That was only given to us for that year at that point and we are in discussions with them at the moment about what should be carried forward into the current year. There is likely to be another addition for that.

I do not know what other Members of the Committee would find helpful but I would find it really helpful in terms of looking at how the Department has performed if we could have what the budget was for each year and then what the outturn was for each year. All we get are outturn figures so we only know what you have spent, we never know what you were meant to spend unless we really dig down into the figures and go to the Treasury. Is that something we can look at for future years?

(Sir Hayden Phillips) Absolutely, and I think we also will see whether we cannot find a way because now the budget that is formally set for us is not necessarily the figure we actually have, ie ---- No, wait. It is not total Sir Humphrey, I assure you. There is the CGS reserve which we can draw down on and there is now a new asylum budget shared with the Home Office and, again, that will be additional. I think what we might try to do, and we can do this with the clerk to the Committee, is to test out some presentations of those figures so by the time we come to do our Departmental Report next year we are doing it in a way which takes account of the Committee's view on what is a good presentation and what is not.

It would just help because then we could see what you were meant to spend, the targets you were meant to meet, what you met and what you actually spent and then one can take a view about the performance of the Department. One other question, and I am sorry to go back to the favourite of targets but I was rather captivated by the one on page 80, target number nine. The target was an increase in the proportion of undisputed invoices paid within 30 days, presumably this is to small businesses and the like, and this target was not met and is now dropped, I just wondered why that was.

(Ms Rowe) We continue to target that particular activity to make sure we actually meet our obligations. Just in terms of the suite of targets on which we report to the Treasury it is not in there.

But it is important that big departments with billion pound budgets pay small businesses, stationery companies, the people who produce the annual report on time. Should that not be a target then?

(Ms Rowe) We monitor it and we have an internal target.

But it was not met.

(Ms Rowe) It was not met on that occasion. I am trying to see if I have the relevant figures here or not.

(Sir Hayden Phillips) I see the point absolutely. It is important to us that we do pay our bills on time, particularly where you are dealing with small suppliers. We do have statistics about this actually, I have not got them with me, about how well we are performing. I am sorry to do this but if I could let you have a note that indicates why the target was not met and what our achievement rate actually was, I think that would be the best way to help the Committee.

One thing the Home Office said was even if a target was dropped that it would be reported on in future years because otherwise one would just come up with a new set of targets every year. It would be nice to see the Department reporting upon how it is paying its invoices and how quickly and how small businesses are being affected, even if it is not an official target.

(Sir Hayden Phillips) I accept that. Just making the comment that we had in earlier discussion, the issue of reporting on past targets, even if they do not have them any more for performance, is a good thing but at the same time we want also to simplify and clarify the presentation. I think there may possibly be an issue here between the difference between what is sensible to put in the Departmental Report - this is not a decided view - and what we make available to the Committee for its investigation into the performance of the Department.

With respect, I think it would be good if every Department had this as a best practice target about paying invoices on time.

(Sir Hayden Phillips) I agree.

So that it goes into the public domain so that small business organisations can see how you are getting on as well.

(Sir Hayden Phillips) I was not commenting on that specific point, I agree with that. I do think there is an issue about the presentation of reams and reams of figures and targets in these reports which is worth looking at.

(Ms Rowe) Can I just make a point on that. There is a target for every Government Department and we do report through the Office of Government Commerce. I suspect the figures may appear in a report that they produce.

(Sir Hayden Phillips) We will give you a note and explain this. I am sorry about that.

Mr Cameron: Thank you very much.

Chairman

One final point: freemasons, disclosure by magistrates and members of the judiciary who are members of the secret society. Where are we up to?

(Sir Hayden Phillips) Where are we up to? We are up to a continuing reasonable story to tell both in relation to the judiciary and the magistrates on a voluntary basis. For serving magistrates we know that 4.6 per cent of the total of serving magistrates are Masons, 88 per cent gave us information, only 12 per cent refused on conscience grounds to respond to the survey.

David Winnick

That is magistrates, is it?

(Sir Hayden Phillips) This is magistrates.

Chairman

On what grounds?

(Sir Hayden Phillips) On conscience grounds. That is what I am told. The position is that all new magistrates are required to answer the question on the application form and all part-time and full-time applicants or appointees to the Judicial Office are required also to indicate whether they are Masons or not. We have not had a problem so far with anyone refusing to do so.

At that stage they do not have a conscience because they know they will not get the job if they do not answer the question but this conscience develops later on once they have been in the job, is that right?

(Sir Hayden Phillips) I take it from what you are saying, Chairman, you rather approve of what we have done.

I do approve of what you have done although personally I would go a step or two further. Let me put it to you: those who decline to respond perhaps you ought to publish the names. It is openness we are talking about here, there is nothing wrong with Freemasons it is just nobody wants to talk about it.

(Sir Hayden Phillips) We are taking the view that as far as serving judges or magistrates are concerned, as this was not a condition when they joined, we should do it on a voluntary basis and that remains, I think, the Lord Chancellor's view. As for publication or access, ministers have not decided that yet, they are still thinking about it.

This is the longest piece of thinking.

(Sir Hayden Phillips) It is a very difficult matter. There is an issue about whether to do that would actually be an unreasonable interference in someone's right to privacy in this area and that has to be taken into account. I am not saying that is a conclusive view, I am saying the factors are the balance in favour of openness on the one hand against individual rights on the other against the background that at least in relation to the magistracy and the judiciary we have a system that is working and has been fully observed by all new entrants, which I think is satisfactory.

Have you got some figures for the declarations by new entrants?

(Sir Hayden Phillips) I have not got numbers for new entrants. What I know is there have been no problems in the sense that no-one has refused to make the declaration, but I can send you the numbers.

Would you send us a note?

(Sir Hayden Phillips) Ever since the compulsory requirement has been in place.

Since the new system came in.

(Sir Hayden Phillips) Yes.

Chairman: Thank you.

David Winnick

That is magistrates but as regards other judicial positions from the highest to the less high positions, judges and so on, the new entrants, are they required to give an answer whether they are Freemasons or not?

(Sir Hayden Phillips) Yes, they are. All new entrants to the full-time or part-time judiciary at whatever level are so required and we have had no-one yet who has refused.

Where existing magistrates have refused to answer on the grounds of what is described as "conscience", is there any follow-up where the Lord Chancellor's Department writes back and suggests that since others have answered the question there is no reason why they should not?

(Sir Hayden Phillips) We have not done that, to my knowledge. The survey which I was referring to, as the Chairman knows, was conducted in 1997. We asked people to do it on a voluntary basis, we thought that was right at the time. Certainly I am willing to consider discussing this again with the Lord Chancellor to see whether we should do a further survey and ask those who had not responded then whether they are prepared to because 88 per cent of their colleagues have.

Of magistrates?

(Sir Hayden Phillips) Of magistrates. I prefer not to make a decisive conclusion on that but to take that away with me and have a look at it.

Others in judicial positions who have refused to answer the question, have you got any figures on that?

(Sir Hayden Phillips) As far as the judiciary are concerned, as of 30 September 1999 86 per cent had disclosed they were non-Masons, that is the main figure I have got. I do not think I can give you any more information than that at the moment.

So it is much the same as magistrates?

(Sir Hayden Phillips) It is very much the same sort of rate of response from serving judiciary on a voluntary basis. I take the point you are making both in relation to magistrates and I assume to the other judiciary. I will go back and have a word with the Lord Chancellor about it.

Chairman

Thank you, that is fine. Sir Hayden, Ms Rowe, Mr Magee, thank you very much for coming along, you have been extremely helpful.

(Sir Hayden Phillips) Thank you.