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Oral evidence Taken before the Constitutional Affairs Committee on Tuesday 16 September 2003 Members present: Mr A J Beith, in the Chair __________ Examination of Witnesses Witnesses: MR PHILIP ELY OBE, Chairman, MS CLARE DODGSON, Chief Executive and MR ROGER HAMILTON, Director of Policy & Legal, Legal Services Commission, examined. Q1 Chairman: Ms Dodgson, Mr Ely, we are very glad to have you with us. There is a lot you can tell us about the difficult task you have in controlling costs and ensuring that legal services can be provided. Is there a limit on how much funding can be diverted from the Community Legal Service budget to the Criminal Defence Service budget? Can this raiding go on? Ms Dodgson: I do not think raiding is the right word for it. I think what we need, Chairman, is a balanced portfolio in Legal Aid. Clearly we have cross-pressures in Criminal because Criminal is driven by factors that are not necessarily within the control of the Legal Services Commission, but we do need to keep a balanced portfolio. I think one of the things that the Commission needs to do as it forward plans is to look at what that portfolio should be and how do we maybe not absolutely ring-fence, but how do we balance investment that Government wishes to make in giving different client groups access to different types of publicly funded legal advice. Mr Ely: I think the linked point is whether there is to be a sufficient payoff from the management, particularly of very high cost cases. It is a new regime effectively, but it does not need me to tell you of the scale of the spend up at the top of the scale in terms of the high cost cases. My own view is that the management of that is achievable. It is early days yet and, of course, it involves negotiation, it involves case management, it involves negotiating fees and so forth. I think it can be done and most certainly it needs to be done. It needs to be high on our priorities otherwise the leaching effect from crime to civil and from legal help will continue unless - the unless I do not need to spell out to you - there is more funding. Q2 Chairman: It has been indicated to us by the Lord Chancellor's Department - indeed, the Lord Chancellor himself, I forget which - that one of the drivers for budgetary pressure is in the increased number of cases being brought to court by the police. Success, if you like, in terms of getting cases to court at any rate means more budgetary problems for you. That is an issue which does not seem to be considered, the budgetary implications of a drive to prosecute particular kinds of cases. Are you doing anything to make sure that it is considered and recognised when the decision has been taken? Mr Ely: I think awareness matters a great deal. Across the spectrum - and I speak slightly from ignorance in saying this, but I will do it nonetheless - I think very often there is insufficient account taken of the Legal Aid cost implications of new practice, new legislation and so forth and, of course, by the time that hits the fund, it is almost too late. I think our job even today, but wider than that, is to create an awareness of that and we have just got to do it as part of our job for the management and development of the Community Legal Service. Ms Dodgson: Being specific, Chairman, I think one particular area is to work with the Home Office more closely both at official level and also, I know that our ministers are working with their counterparts in the Home Office because there are some specific things that we need to get into, which I describe as "upstream". As policy thinking and planning is being worked through, how do we model and cost the consequences for Legal Aid on the back of that? I think that is very important, it is a specific area. As you know, I am relatively new to this particular job, but that is one of my personal priorities, to develop the relationships with my counterparts in the Home Office and that has already started.
Q3 Chairman: Are there other policy developments which could help to counterbalance this, such as your efforts in mediation? Ms Dodgson: I think we have got some very real questions to ask ourselves and answer about mediation. Certainly I have been talking to a lot of groups that are not just the Law Society or the Legal Aid Practitioners' Group - as have many of my colleagues including my chairman - to say what is the role of mediation, what is the role of the not-for-profit sector, what is the role for organisations like the Citizens' Advice Bureau? How do we work with other government agencies? I used to work in JobCentre Plus, we had tens of thousands of advisers who were working with people on welfare benefit or who were looking for jobs. What links could we make there to say that we could signpost people who have housing or debt problems into Community Legal Service Partnerships, for example? I think you are absolutely right, there is a real role for us to start working with other government departments and other agencies because many of the clients are the same people. They are people who are vulnerable, disadvantaged, very often their lifestyles are chaotic, and if we can start with the individuals, their families and their communities and then build our services around them - I use the term "wrap the service around the individual" rather than "salami slice" the person into the services - then I genuinely believe we have got a job to be done. Personally I genuinely believe Legal Aid has got an important part to play in tackling social exclusion or bringing back social inclusion, whichever way we want to look at it. Chairman, I want to promote and all of my senior managers want to promote that agenda positively and constructively. Mr Ely: Going back to your specific on the question of mediation, I think one has to say that has been a long haul. I happened to notice that your last witness was Lord Mackay, the former Lord Chancellor, and I recall that a decade ago when he was Lord Chancellor he was particularly anxious to drive forward mediation in family work. I think enormous progress has been made, and it is easy to say that. I think the understanding of the role of mediation is coming up the agenda, but it is a long time. Our own pilots in relation to family, the FAInS pilot and the FAInS work, has taken time. Again, I am sorry to be negative, but I do not think one can do it for less, I think one has to develop and evolve it in that way and it is in with a chance. Q4 Chairman: You mentioned the very high cost of cases, but looking at the average case costs how do you intend to bring average costs per case on the civil side under control because they have been rising? Mr Ely: I think the first thing is to establish the core information, the database. Research is needed, research is being undertaken to find out what are the drivers of the average cost at the present time, let alone what is driving the increase. A simplistic view might say: "We are demanding quality. Quality has a price and that is contributory to the average cost increase". I do not believe it is, or it may be a part but I think there are fundamental points of information that we need. For example, why is the cost case of Firm A as against Firm B in a particular locality different? They are in competition, but equally there are elements in there that ought to be the same, one has got to find that and manage it. I know the chief executive has a pretty strong view on that. Ms Dodgson: I do indeed, Chairman. Two specific things. We have an evolving and, I believe, improving audit process which now looks much more at average costs per case and starts benchmarking those and feeding back to suppliers. The Committee may be aware that we categorise in Category 1, Category 2 and Category 3, and the Category 3 suppliers we have been targeting very hard and saying: "You are an outlier. You are a high cost provider. This is unacceptable. We need to understand why this is the case and we need to tackle it". We are moving back into Category 2 and we are feeding those costs back to the individual suppliers, so we are taking out the poor value high cost suppliers in significant numbers. The other point, Chairman, is that the Director of Policy & Legal, who is here with us today, is working on some proposals for next year which we are discussing at the moment and have not finalised - including we have not finalised them with our ministers - as to how can we get even more explicit about putting a cap on the costs of certain cases, and also incentivising and rewarding our high value high quality providers. At the moment we would say Category 1 because that is the best measure we have, but we are certainly on the case and we know that we need to do that. Early figures for this year are encouraging about the cost rise being contained to a lower level, but they are very early figures. I would not want to put on record to the Committee that we are confident about the outturn for this current year. We are seeing, as I say, some positive early indications. Q5 Ross Cranston: I was going to ask about the research that you have done on increasing the high average cost. Have you done comparable studies with the private sector? A lot of this work will not be privately funded income for crime, most of it is publicly funded. Where you can do comparisons, is it the case that lawyers are driving costs up again or is it just this view? Ms Dodgson: We have not done the specific cost comparators but I think you are right that we need to do that. We need to benchmark not just internally and look at what we are doing ourselves, but we need to make those cross-readings. We have just appointed a project director of performance and change, which was announced yesterday as it happens, who is working to the executive board to take forward what I would describe as action research. Not a piece of research that takes three years to produce an outcome and gets published in a referee journal, but research that can genuinely help us plan and tackle cost containment and get a better picture on need and demand, supply and provision, map the two together, look at the different clusters and types of cases and clients and get a better fit between the Legal Aid spend and the wider private sector spend. I am very keen that with David Clementi's review of the legal profession in the round we recognise that Legal Aid has a very significant contribution to make to that map. In my personal view - as a public servant for 20-plus years - it has a unique contribution to make because we are helping the most vulnerable and disadvantaged people in society and, therefore, we need to make sure that Legal Aid is well presented as part of that wider map. Have we got what I would describe as the metrics, which I think you are challenging me for at the moment? No, we have not. Do I agree that we need to develop those and look more widely at benchmarking performance, not just cost? Yes, certainly I do, and we are on the case. Q6 Ross Cranston: On the criminal side, you do now have the pilots with the involvement of publicly employed lawyers? Ms Dodgson: We do. Q7 Ross Cranston: Has that thrown up any indications yet about probable costs? Mr Ely: I think it is too early to say. It has been running effectively for a year to two years and I do not know that there are even yet signals emerging because I think thus far people would not want to draw the conclusions they want to draw, whether it is in the public as against the private sector. If I could go back just one step. When you say has there been a comparison with the private practice and non-legally aided work in relation to average cost, the answer thus far as you have heard is no, but we are on it. I think there is a need to recognise - and others will plead this, but I cannot forget that I was a solicitor, I am even on the roll still - the actual benefit or profit to be derived from that same work. Now whether the Lord Chancellor's current investigation into supply and demand within the legal profession and so forth is going to begin to throw up the causes and the comparisons between privately funded work and publicly funded work, it is too early to say. Frankly, the supplier base will suffer if we do not get that right. Q8 Ross Cranston: Before I say anything more, I should declare an interest as a practising barrister, not that I did publicly funded work. Ms Dodgson: Two other points on the pilots. My experience in public service tells me that pump priming is sometimes necessary for pilots. I think we need to make sure that we take that into account. You are starting something up from scratch and it is new. Secondly, there is a wider question in my view, which brings me back to the David Clementi review work about a catalyst for change. Do we wish to put in pilots which are catalysts for change and drivers of doing things differently? We need to take a qualitative as well as a quantitative view of some of these new models would be my view. Q9 Chairman: Looking now at very high cost criminal cases, one per cent would be work and 50 per cent would be the cost. You have got quite ambitious targets for savings: £30 million in 2003/04, £70 million and £90 million. Can you meet these targets? Ms Dodgson: We recognise they are ambitious. In preparation for this Committee, Chairman, last week my Executive Board and myself asked that very question of ourselves. We believe within the broad financial parameters and the modelling that we have done, yes, they are achievable, but they are ambitious. Q10 Chairman: Did the Chancellor jump the gun when he announced that all new very high cost criminal cases would be managed under individual case contracts before we have had experience of the new regime settling down or being assessed? Mr Ely: May I be impudent and say I suppose that is really a question for the Lord Chancellor rather than for us. Having said that, there has been experience within the Commission of the management of high cost cases. I know it is now moving to crime where the figures are so much greater, but we have had similar experience in relation to the civil side and in relation to multiparty actions and that sort of thing, so there is a track record in relation to the management of cases on that scale. Obviously that is information that would have been shared and fed back to the Lord Chancellor's Department - as it was - and I think would lead to the conclusion you mentioned. Ms Dodgson: I think, Chairman, standing still was not an option for the reasons you mentioned earlier. If we are getting such a small proportion of cases consuming such a high proportion of the limited budget, then taking action that seems sensible, advised by our board directors - our chairman, as he has said, is a lawyer - we have expert lawyers, who are on our board, who have looked at this and said: "We have to do something. We have to do something that is as sensible as we can in the circumstances that we are in and this is the way to act." It may need to be learned from, improved and evolved as time goes on, but from what I have seen I think it was quite the right thing to do to get some sort of grip and handle on some of these very high cost individual cases and what is happening underneath the headline numbers. Q11 Peter Bottomley: To go back to the point that was remarked on before. I hope when you do this you will keep an eye on cases like the one of Superintendent Ali Dizaei, where the prosecution seemed to throw a fortune at a particular case, and then dropped it a week or two before it came up and then argued the merits of that case. I think that people, where there are contracts, ought to watch what is happening on the prosecution side and try to get some kind of equity. Now can I switch to Community Legal Services. On the question of Legal Aid providers, if there are shortages how has that happened and what happens to make sure there is not that shortage of providers? Ms Dodgson: This was the point I was making earlier on, that we need a better fix on need and demand and supply and provision. I describe it as "Can I have my green, amber, red, please, for different types of cases and different types of providers?" and looking to our regional directors - which we already are doing - to say: "You must know your patch." I was out in Birmingham yesterday with the regional director there. We met with a group of local suppliers of all different types and descriptions to talk to them about what was happening there. We need to understand where the red spots are, not just where we have undersupply, but in some instances, particularly in London - and my director for London is here - we have oversupply in certain categories. How do we shape our supplier base to best fit not just the budget but the requirements of the communities that we serve? Where we have hot spots and where we have genuine shortages, I am looking to each regional director to understand that, to work with the national operations director and to do things that are sensible about moving services around, moving what are called new matter starts around, which are new cases around the system, and making sure that we respond to those pressures as best we can in the light of the funds and services that we have available. We take them very seriously. Mr Ely: I think we must, as part of our remit, have constant anxiety as to the strength of the supplier base. It is something which is identified in this year's Annual Report and it is something that was flagged up in earlier years. It has been flagged up, and one has to grasp this firmly, in terms of pay and remuneration. My own view - and it is more than an anecdotal view because one is engaged in this - is that is a material factor in the pressure on the supplier base. Now at the moment supply and demand is not a cause for concern, but it is simply something we have to have a handle on as the chief executive has indicated. I think there are other ways. One moves on in terms of saying if there is not a supplier base at all, how do you deal with it? You have to look at alternative methods of delivery. We are engaged in that process - telephones in Wales and the West Country and that sort of thing - alternative means of supply which can try to meet it, but it must be at the forefront of our worries I think. Q12 Peter Bottomley: Regional directors should be open to clients, advocates and others who might spot gaps and make sure that attention is paid to them? Mr Ely: Yes. As far as solicitors are concerned, we are entering the next bid round currently and that has to engage that process as well. New suppliers have to have the opportunity to bid. It is very difficult, one has to say, against a constrained budget, but at least the opportunity must be there. Ms Dodgson: The other thing, Chairman, to mention is the Just Ask! website, which has been there for a while but has been relaunched recently and genuinely revamped. I have been into it myself. I have used it and have navigated around it. I went into welfare benefits - that was my previous history - and had a look. I genuinely think for people who have relatively straightforward queries the website is now offering an improved service, for a lot of people rather than having to go into the high street solicitor, make an appointment, go and sit there and wait, if you can go onto the Internet and use a site that lets you find out the straightforward things that you need to know. We are committed also to the website as well. Q13 Peter Bottomley: Do you look at the not-for- profit sector as a way of filling gaps, or do you look also at the general signs because you would know where there are gaps? Mr Ely: I think they are providing complementary services. I think the strengths of the not-for- profit sector have been particularly identified in all the recent reviews in relation to social welfare, housing law, et cetera. I think that is something we have to use where they provide - and in the end one comes back to this - better value for money - that is the service one should be using - where they do not, one should not. Ms Dodgson: I think complementary is the right word, or as partners, particularly housing welfare benefit, I am very struck by debt. The Citizens' Advice Bureau I thought did an excellent report on debt and indebtedness. For some people relatively small amounts of money can make the difference between them being able to float or sink in cash. I think we ought to be thinking through more strategically, which is a word managers use, it is overused, but I genuinely know what I mean by that. What should our supply base look like and what part should the not-for- profit providers and suppliers play in that overall picture? I think, yes, there is a real role for them, but they cannot be a substitute. There are some things that only legally qualified suppliers can and should do, and we need to tease out more effectively who can and should do what across the piece. Mr Ely: For example, in London - which I have chaired for some time - we are a part of the East London debt strategy, which is specifically designed to look at the way in which debt advice is delivered. At what point do you need the specialist input? How does that relate to and refer to others? How does it work into the region, for example, because conventionally in London we have done it by borough, which was not always right. Groupings of boroughs, if they can be thus persuaded, will deliver a mission together of the sort of advice you get. In London we think that might apply to other types of advice in different parts of London. We have a problem in London with the outer boroughs with shortage of supply. How do you meet that? Do you look at it in terms of groups of boroughs or do you look at the method of delivery? What part does the lawyer and the not-for-profit play in that? I believe that needs to be worked through. Q14 Peter Bottomley: You have a review of supply, demand and purchasing arrangements and you have the new contracts for solicitors next year. Can you tell us what the preliminary findings are on this and what the impact is likely to be? Ms Dodgson: They are still looking at the preliminary findings. I hope it will give us a much a better understanding of what the cost drivers are. In fact, I more than hope I believe it will give us a much better understanding of what the cost drivers are. I believe it will feed then into our work with the Department of Constitutional Affairs as to how do we plan not just for the next year, because I do think we have an operational timescale for how do we get to the end of this year and plan for the next operational year but more longer term, 18 months, three years, five years, going back to the wider ranging review the Government has commissioned of law as a profession, what position does Legal Aid have in that? I think we need to make sure to keep a grip on the short-term operational issues for Legal Aid. I need to make sure - because I am the accounting officer - that we keep a grip on the costs, that we can account for what we are spending. Also, I want to know what the drivers are in these different categories of provision and with different types of supplier, and what is the best value in both quality and in the cost issues, the value for money questions, to pull those two things and mesh them together more effectively. I would like to see that review of supply, demand and purchasing being a contributor to that, but it would not cover all the elements of customer service and quality of service, the Just Ask! website and things like that, which need also to be built into our strategy for the future. Mr Ely: I think the other thing in relation to need, the total information as to need, both from the research and from the local work that has been done within partnerships, within partnership areas, boroughs and the rest of it, at the end of the day I think it is relatively sophisticated. The top line model gives you information based on all the usual sources, if you like, and more. My experience is that in the main the local input that is added through the partnership is, I would say, pretty good, it is very often anecdotal. Going back to the start of your question, that is filling it in, and I think the picture that emerges and the information that the Commissioner has is much greater than it ever was. Now, of course, I accept that one then comes back to the question of how do you fill that need in relation to the current contract round given the limited resources, and I am not going to attempt to square that circle. I think it is our job, I may say, to do the best, to identify through the regional directors how the funding is to be spread round against the background of that information, but I think the information is good enough. I would share your concern as to whether it can be met. Q15 Peter Bottomley: Ms Dodgson, I think we ought not to let you come here without saying to you and to those who work for you and with you, that in each of our constituencies every day there are people in trouble who find that their problems are, if not totally solved, at least resolved in a far more satisfactory way than what we would expect and we are grateful for the services which are provided. Ms Dodgson: Thank you very much. Q16 Peter Bottomley: Let us move on to the last section of our submission. Solicitors can be encouraged into publicly funded firms by sponsoring students on Legal Practice Courses. Is there an evaluation of the success you get from this? Mr Ely: It is so awful to say: "It is too early again", it is a terrible thing but last year was the first. It is monitored and I will not go further than that. We see it as our job to keep a grip on that and I believe it is working. I believe they have been placed in the right places and it is a base for further supply. Beyond that, I think it is silly to try and answer it. Q17 Ross Cranston: I want to ask a few supplementaries about this area. The Law Societies use this graphic phrase "advice deserts" and the latest phrase is hotspots and so on. How big are these deserts and what parts of the country are we talking about if they are deserts? Mr Ely: Wales inevitably because of the difficulties of access within the Principality, but that is being met because partnerships have been created. They have funding not just from the Government but from other sources as well to deliver supplies through. Deserts is the wrong expression of Wales, I am sure, but that is one you would readily identify and inevitably the rural areas. Coming back to the question of supply, we have a conundrum as to how to meet demand in those deserts and it goes something like this. If the original driver is to say that we want quality service, we want contract, we are going to drive up standards all the time and we require supervisors and so forth, that imposes constraints inevitably. In order to meet that the system was developed on the basis that firms were allowed to do work under tolerance - as it is called - where they could do work which was not their specialisation, provided they met certain standards again. The conundrum we have is to say does one allow tolerance work to continue in order to assist in the advice deserts? I believe the answer is firmly yes, provided again one is doing the job of supervision properly in different ways but tolerance is yes, whereas perhaps within the conurbations one would say tolerance is no, because you should be developing specialisations. Q18 Ross Cranston: You are adopting that passport road to tolerance, are you? Mr Ely: Yes. Ms Dodgson: Yes, we are indeed, and just reiterating the Just Ask! website for user telephones. Q19 Ross Cranston: Yes. Can I press you on that. You are relaunching that. I have used it as well and it is excellent, but I just question whether there are people out in rural Wales who use Just Ask! Ms Dodgson: That is a fair comment Q20 Ross Cranston: You mentioned the telephone and that is absolutely fine and I commend you for that. I thought the telephone thing was secondary, it was not a front line service. In other words, someone in Wales can come to a border control telephone box and ring up an advice line on housing, for example - their solicitors can - to get advice. Ms Dodgson: It is trying to get the best match, I believe, and also we are looking at innovative ways of doing outreach. Where you have a base it may be not be a full-time service, but it may be to say we need access to family law help in a particular part of Wales or wherever, can we have outreach sessions, and can we make sure the local community know that on Wednesday afternoon there will be somebody there that they can see face to face, so nothing is a universal answer to this. As the Chairman said, we have to take it very seriously. We have to look to regional directors to look at rural areas and make sure that they know their patch, and that we look at all the different options of trying to make sure they can have access. Q21 Ross Cranston: I am not criticising you at all because I realise the budgetary problem. The Chairman started by talking about criminal work, it is also asylum work which is pushing your budget up out of shape. Ms Dodgson: Yes. Q22 Ross Cranston: It has meant, has it not, that you were intending to put much more emphasis on the not-for-profit sector, but you just have not had that flexibility to build up state CAVs and so on because of these budgetary pressures? Not only in rural Wales would we have the Asylum Act? Ms Dodgson: Yes. Q23 Ross Cranston: You have not had the chance to do that because of these budgetary problems? Ms Dodgson: Yes. Mr Ely: I do not think one can rail against that. We can, I think we have just got to get on with what we have. I think you are absolutely right, if the asylum budget had not gone up to £175 million, I guess we would have a more sympathetic ear in the discussions that we properly had with the Treasury and elsewhere. I make absolutely no criticism of that because I think one has to work within that lot, that is the fact. One comes back to the Chairman's point again and I can say truthfully the management process is enabling us to do it, but it is a tough call I think. Q24 Ross Cranston: Yes, we had an inquiry about asylum and have our own impressions about it. Mr Ely: If I just come back on one point only on that. I guess I am allowed to say this as Chairman, I am a fan of the Community Legal Service and the need for it to develop and without it all of these things would not be happening. I think one of the anxieties that I would have - again as Chairman of London, not for much longer, and the regional chairmen - goes something like this. I think that the engagement of others - conventionally it is called partnership, I do not care what you call it - in what is going on has created expectation and hope. I think one can sustain that for so long saying we must work together, there is a payoff in this, there is a payoff in referrals, there is a payoff in the understanding about who does what, all of that, but the moment of truth comes at a certain point where they will say quite properly: "There is no more in it for us". Government meets that in part with initial budgets and so forth and that is again part of the process and one must never lose sight of that, but it is - I repeat - a close call. Ms Dodgson: Also, I think there is something for the Commission itself. We are a non-departmental public body. The point I made to the Chairman earlier on about a balanced portfolio, we have to be able to say: "We are here to provide a spectrum of services to a spectrum of the most vulnerable and disadvantaged people in society", which is a point I keep repeating. People talk to me about our suppliers. When I first came into post I found myself saying: "People do not talk to me enough about clients, communities and providing services". I have not pre-discussed this with the Chairman but I think we have as a Commission, to set out our stall, if you like, about what is the balanced portfolio, and that means if we risk things been skewed by a particular area, we have to flag that up. We have got to have a view about how we handle that, but I do think it is important that we keep the balance. Q25 Mrs Cryer: How much responsibility do you feel the Commission bears for the failure to improve standards in the legal profession? Are you doing any work with the Office for the Supervision of Solicitors and the Law Society to raise those standards? Ms Dodgson: I think the Commission has a responsibility to raise the standards of our suppliers certainly. We are giving them public funding, so we must do that and we have done that. We have gone through Quality Mark, through franchising of providers; we have put in an audit process, we have refined that audit process and, even looking at it now three months into post, certainly it is a step forward from the initial audit process. It is much more risk-based, it is lighter touch on the Category 1 providers and it is much heavier-handed with the Category 3 providers. Within our supplier base, yes, we do have a responsibility and we are taking that responsibility seriously and acting on it. In relation to the wider profession, of course some of our suppliers do work other than Legal Aid, so there is a boundary question across that. Yes, we do work with the Law Society and the Office for the Supervision of Solicitors, and Roger Hamilton, the director of policy & legal who is here today, has a professional role in doing that. Personally I meet with the Chief Executive of the Law Society certainly and we look at where there is due cause, making sure that if we believe there is an abuse of the system or fraud, we refer those suppliers to the OSS. Q26 Mrs Cryer: You mention the Quality Mark, how long do you think it will be before all the publicly funded solicitors will have the Quality Mark? Mr Ely: They do. Ms Dodgson: They have to. Q27 Mrs Cryer: All of them? Mr Ely: Yes. Indeed, that is very important. I suppose the starting point, of course, was that - however many years ago it was, I have forgotten now, dare I say, it was ten years ago - the principle was we would only engage with those who have the Quality Mark. At that stage - one has to be open about it - we will offer incentives to those who do. Likewise, at that stage, we work with people we think will not be excluded. The world has moved on from that and the current position is that only Quality Mark firms are contracted and if they do not measure up ultimately their contracts come to an end. I say ultimately because within the questions we were sent there were issues about this and about the time taken to remove firms. I think it is an almost inevitable consequence if you have what is a fair contracting system these firms are engaged with us under the law as contracted firms, so that will be a process that has to be gone through. Again, I just draw on some experience. I guess I slightly bridled when you said drive up standards, I think that is an issue primarily between you and the Law Society, but we are a part of that. I think, in spite of the horror stories one reads, I can say that in relation to much of the work we engage in - and I am talking about very high cost inevitably because I see that on the Serious Fraud Panel and many of the criminal panels - the quality is high. What one is really saying is the expectation is that we want across the piece and we will work to that, no question, and that engages the Law Society and the OSS as well. I guess it is approaching it from a different perspective. Q28 Mrs Cryer: Further to that can I ask you how you are streamlining the process of removing poorly performing solicitors to deal with the high levels of appeals and significant delays which have been experienced, and what sanctions other than removal are there for firms who are not meeting the quality standards required? Mr Ely: I would need to reflect for a moment on the other sanctions. I am familiar with them, but they have just gone out of my mind for the moment. In terms of the speeding up of the contract process - again, you will have seen this in the papers - the starting point is the need for an increasing awareness on our part. You cannot suddenly say contracting was the answer and removal of contract, one has to learn. I think the learning, particularly over the last 18 months, is in relation to the need to identify which are the poor performers based on a variety of indices; information to the local office and so forth; feedback, which are the firms that need to be looked at. Inevitably one suspects that will begin - quite apart from the contract audit - to put them in the Category 3 slot. If, within that, one has a specific time mark, you are beginning to get to the point where you can remove them quickly. Now if they are guilty of wrongs, that is the end of it, the contract can be brought to an end straightaway. Ms Dodgson: The point I was going to make was if we find evidence of fraudulent abuse, we can act virtually immediately but we have to have the facts to do that. What we are saying is if you are Category 3 twice, the first time we will work with you to try and help you understand what your problems are and improve and the second time, then that is it. We are not giving Legal Aid contracts to practices who are Category 3 twice in a row. We are moving into more qualitative measures of performance as well, so we have got what I am describing as a balanced scorecard, which is quite a familiar concept in other parts of the public and private sectors. Again, the appointment I mentioned earlier on in the Committee with the national director for performance and change, you will be charged with working with the executive board to say: "These are the things that we have currently, how can be build and develop on those to get a more rounded picture of our suppliers?" Q29 Mrs Cryer: So you do not necessarily have to go to removal, you are discussing with the various firms where they are falling behind? Ms Dodgson: We are looking for a balance about all of this. If people are providing poor quality, poor value, service, we will not be giving them public money and I think we ought to be absolutely clear about that and not defensive and not apologetic. In talking to suppliers, and I talked to a big group of them yesterday, I make no bones about that. We are spending £2 billion of public funding and we need to get good value for it and, if we are not, we need to stop giving it to poor suppliers. The next question, which I think is part of what you are asking, is, are those suppliers still practising, and that is the question where we have to talk to the Law Society but, I agree with the chairman, primarily it is a professional regulatory issue. Are they practising with a Legal Aid contract? Answer, no. Those two things have to come together and I think we have to look at it like that. But, equally, and I was talking about this yesterday again in Birmingham, there is the relationship with management. We want to have a high quality supply base and to have a good relationship with them, but if you were a base of suppliers who had one big customer who gave you a very significant income at a national level which was blue chip, guaranteed government cash, what kind of relationship would you want with the Commission? So we are really going to start over the next few weeks, months and into next year and beyond, saying, "How can we have a better adult-to-adult relationship with our supply base? How can we work to the mutual benefit not of the supplier and the Commission but of the client and their families and communities?" That is the real job, in our view. The other things have to be done and done well and professionally and that is in everybody's interest, but that is the end game as far as I am concerned. Q30 Dr Whitehead: I wonder if you have rather mixed feelings about the removal of personal injury work from Legal Aid, or largely from Legal Aid, and the resultant concerns about ambulance chasing and what appears to be, after the passage of time, a very large number of worthless cases? Do you wish it had not been thus or do you think that the down pressure on Legal Aid that that represents is a good trade-off? Mr Ely: I think it is a question that you cannot win, can you. Speaking for myself, ultimately this is for Government. I am copping out if I say that but it is for Government and it was a subject of full and careful debate, as they say, and decisions were made and I would not seek to go behind that. That is cowardly but it is not my job. Having said that, if personal injury had remained in the system there is no question there would be need for greater funding, so you would be back with the old issues again or the existing budget would be put under unacceptable pressure, and to that extent one is therefore profoundly relieved. For my part, when PI was withdrawn I said to myself, and I guess I said to others as well, one is going to have to measure down the line whether that is a good thing or not, and that is precisely what is happening at the moment. You put your finger on ambulance chasers, non-lawyers as often as not, and one has that situation which is unacceptable. I think in the greater scheme of things that comes back to, dare I say, it, Committee and Government to say, "Has it gone the right way or not?" My personal view is that on the whole I am sad it has gone, but if it had been there it would have needed greater funding and a recognition of what it was. Do not ask me for the figures, and of course with PI there was a pay-back in terms of cost recovery and all the rest of it, but just as a philosophical point I am sorry it has gone, but there we are. Q31 Dr Whitehead: From a practical point of view, you would say significant savings have been achieved? Mr Ely: Yes, and they have been measured. Q32 Dr Whitehead: On that particular line of thought, are there other areas currently funded by Legal Aid which might be suitable candidates for having this principle applied to them? Mr Ely: I think we have been cut to the bone in terms of the categories of work. In a sense I have two answers to that. The first is that I think it is a good thing that the focus, particularly in relation to legal help, is on social welfare and its relationship to exclusion and the intellectual problems of those who really are in need. In my judgment that is sacrosanct. If one moves wider than that, then inevitably one identifies the considerable spend on family work, but if one strips that out - and I have not got the answer to this in detail - and asks what that actually embraces, if it embraces children, the custody of children, the care of children and so forth, that again is essential work. I think the pilots which have been undertaken in relation to families and mediation are going to throw up what is the real need in relation to family work. At some point that is an exercise which has to be engaged in. Ms Dodgson: I would come back to this point about a balanced portfolio and, having spent over 20 years working in different parts of public service, there is always a question about eligibility criteria and access, whether it is the NHS, welfare benefits, Legal Aid. Ultimately that is for ministers and Government to have a debate about. My personal view, as I said earlier on, Chairman, is that we need a balanced portfolio and there are a whole host of reasons why that is the case, which we have touched on over the last hour or so. Mr Ely: The other thing is that I think it is about right, and that is a personal view as well as a chairman-engaged-in-the-process view. One would like to see PI back but if one looks at the way the Funding Code operates and the way in which public interest is identified as special, and therefore when funding is needed it is there, one is looking at public interest criteria, and if one is looking at clinical negligence and so forth, looking at all those things in terms of where we stand in society, I think we are about right. Ms Dodgson: Clinical litigation is an interesting example because the Chief Medical Officer's report suggests some changes in the way we deal with those cases and we need to work through where those changes are to be implemented, what will the implications be for Legal Aid, and what cases would we or would we not deal with compared to the system as it is now. Q33 Dr Whitehead: Do you think the knowledge in the general public realm about the point at which eligibility for Legal Aid moves into conditional fee regimes, is something that the Legal Services Commission could look at to a greater extent, or are you happy the general public is aware of it? I am thinking particularly of the role of the Just Ask! website for instance in making that clear. Ms Dodgson: I think we could do more. We have identified again a priority in communications with the media and the public about the services we provide, the links with other bits of the public sector and how you get access to them, what links you use. We have new people with communications expertise who are also here today who are helping us to do that. But, yes, I believe we could and should look at what more we could and should do. I think it is quite confusing for people. If you are trying to navigate your way around the network of public services, you have the NHS, you have Job Centre Plus, you have Legal Aid - I will not list to make the point - but how can we be more co-ordinated and integrated in that and have better links between different access points. That is a real question we need to ask. Q34 Dr Whitehead: This is a rather poor link to the question I wanted to ask, but I notice that you indeed acknowledge the usage statistics, or you stated in a memorandum to the Committee you monitor the use of statistics, but you do not actually say what those statistics are. Are you satisfied that the usage of Just Ask!, first of all, is widespread and it is being of genuine use and, secondly, do you monitor who uses the site? Is it, for example, a public access site or is it a lawyers' fallback site? Ms Dodgson: Do we monitor the usage? Yes, we do. Do I have the absolute statistics in front of me? As you gather, I do not have. We can certainly send a note around to the Committee members with the numbers. The reason that we relaunched it was because we felt that whilst it had made a good start we needed to do more with it and we needed to promote it more, but without giving a more detailed note I cannot add anything else at the moment. Chairman, have you anything to say? Mr Ely: No. I take the point, I think we as a Commission should be engaged in the business of saying, "Is it being used to assist people who really need it, rather than it being used as a fallback position for those who are in the system already?" Dare I say it, I think that is the nub of your question. I think it is something we ought to do. Ms Dodgson: I have a colleague who can answer the question, if you are agreeable, Chairman. Q35 Chairman: Would you like to introduce your colleague? Ms Dodgson: This is Roger Hamilton, who is Director of Policy and Legal. Rather than not answer the Committee's questions, which I think is not good practice, I did bring various colleagues with me. Mr Hamilton: I do not have the figures off the top of my head of the actual number of hits on the site, but I can tell you they are substantial and they are doubling every year and they have been doing so since the inception of the site. It is a public access site, so this is the public use of the site. Inevitably, because of that, we cannot tell who it is who is touching the site, looking at it, it could be people from other jurisdictions - and quite often it is - but we are fairly confident it is pretty well used now by those who are either seeking help themselves or are what we call "problem notices", professionals in the caring professions dealing with people with legal problems, looking for sources of help for them. Q36 Chairman: Almost related to that, in our recent report on CAFCASS, the body which is concerned with people who need advice and information, we drew attention to what seemed to be not very good working relations between CAFCASS and the Legal Services Commission, partly in relation to the Family Advice and Information Service Project, which I believe is known as FAInS - a term which probably does not mean very much to people, least of all the families involved - and more generally in relation to the mediation services and the overlapping funding arrangements between the two bodies. Is that something you have addressed or are now addressing? Ms Dodgson: We are addressing it and the Chief Executive of CAFCASS and myself have been in correspondence and have spoken. We have agreed we need to meet because we have agreed there is a common set of things we need to be working on and a common set of clients which are in contact with both agencies. Jonathan Tross and I will be meeting very shortly and we do believe we need to establish a much better, more explicit set of arrangements between CAFCASS and the Commission. Q37 Chairman: I suggest the bare minimum is you meet with the Chief Executive of CAFCASS. I am surprised that has not happened before, even before we reported on the subject. Ms Dodgson: I am talking for myself, Chairman. I have been in post three months and I am sure my predecessor will have met with him. Of course, previously we were part of the Lord Chancellor's Department together, so we were at regular business meetings, even before I took up the post full-time. So it is not a case of suddenly having woken up to the fact that CAFCASS are there and we have a common set of issues we need to deal with together. I think that is a very fair point you have made. Q38 Chairman: The Committee are concerned if any different government departments or related different government departments are in any way impeding progress towards a close working relationship, recognising we deal with some of the same people and between you seeking to provide some of the same services. Ms Dodgson: We would indeed, Chairman, and service level agreements which are written at great length and sit on shelves I am not a fan of, but explicit agreements about where the interfaces of boundaries are and how they need to be handled and managed I am a fan of, because we cannot have things falling down cracks and we cannot have things being duplicated or triplicated because of the current arrangements. So I am very conscious of that and I can give the Committee an assurance that I will personally be following that through, but it will not just be me because of the work needed to be done in the organisations and others of my colleagues need to make sure it happens across the piece. Q39 Mrs Cryer: Can I briefly go back to my question about your role in the removal of solicitors, when you gave some very frank comments and answers? Do your comments suggest that you feel that the time has come to end the self-regulation by solicitors of solicitors? Ms Dodgson: That is the purpose of the review the Government has announced, and we will contribute to that review, as I said earlier. The review has to determine and recommend to ministers and Government how the regulation should or should not change in the future. Mr Ely: Could I declare an interest and answer with a very firm no to your question? However, in saying that can I also say the relationship between that self-regulation body and the board and now the Commission has always been a sound one. It is slightly off-track but if one is seeking to measure quality - and I know this is for other people - if one is seeking to say, "Does it work", the answer is yes. I think for the Commission I would be sorry if that happened, but that is, as I said, the subject of an inquiry and I will not pre-empt that. Chairman: In thanking you for your evidence today can I mention two things to you. One is, as you know, we are carrying out an inquiry into the immigration and asylum appeals system, in which you have a significant input, and the pace of that may quicken slightly in the light of impending Government decisions, so we may come to you for responses quite quickly on some of those issues. Your ability to do that is very well demonstrated by the excellent set of detailed replies you have provided to us to the written questions which we submitted to you, and we are very grateful to you for those and your help in this area. Thank you very much indeed. |