Examination of Witnesses (Questions 69
- 79)
TUESDAY 9 MARCH 2004
ROGER SMITH,
RICHARD MILLER
AND NONY
ARDILL
Chairman: Ms Ardill, Mr Miller, Mr Smith,
welcome, it is very good of you to come and give us the benefit
of your advice and experience this morning. We have some interests
to declare, I think, before we start.
Keith Vaz: I am a non-practising barrister
and my wife has a legal aid contract.
Q68 Chairman: That is about it this
morning. I wonder if I could start by opening up the issue. When
Clare Dodgson from the Legal Services Commission came before us
she did not quite like the phrase "advice deserts" and
referred instead to areas of unmet legal need. Do you think there
is any distinction between these two concepts?
Mr Miller: I think the phrase
"advice deserts" has been used quite a lot over the
past few months without people readily understanding exactly what
it means. It has been taken as a general comment on there being
a lack of availability of legal services. I think what we have
seen is that there are towns cross the country where there is
no longer a legal aid lawyer available, there are problems where
the firms have either run out of physical capacity to take on
new clients or have run out of contract capacity and there are
areas where there are particular fields of law in which it is
difficult to obtain advice. We have heard mentioned quite frequently
the idea that there are no Legal Aid housing lawyers in Kent.
Q69 Chairman: And housing lawyers
in Northumberland?
Mr Miller: Or housing lawyers
in Northumberland, yes.
Ms Ardill: If I could perhaps
add to that point. I think it is very important to be clear what
is meant by "advice", because, of course, within the
Community Legal Service advice operates at a number of different
levels. There is the specialist level, but there is also the general
help level and, underneath that, there is information. If there
is a pattern of provision for general help that does not mean
necessarily that there is provision for specialist help, and it
is very important to be clear, in terms of if one is to use the
phrase "advice deserts", precisely what sort of advice
is being referred to.
Q70 Chairman: The LSC has said that
in the current round 90% of contracting firms have bid and those
who have not have been more than made up for. Does that indicate
there are actually still plenty of solicitors prepared to do legal
aid work of all kinds? That was the picture they were offering
to us.
Mr Miller: I think it is very
difficult to know what the number of bids does actually mean,
because we have not been provided with any information as to who
is making these bids. Certainly my assessment of the situation
would be that a lot of the bids are accounted for, either by firms
that currently do the work under their tolerances and want to
get a subject-specific contract or that are simply bidding, in
the hope of having something left to do after April, with a view
to recruiting staff if they get the contract, or, alternatively,
where you have departments in existing firms who want to break
away and set up their own organisation. Any bids that come within
those categories would actually represent a re-organisation of
existing supply rather than new supply coming in, and I think
it would be very important to try to find out just how much of
the new bids are just this re-organisation rather than new bidders
coming in from outside.
Q71 Chairman: Have you any way of
knowing whether this is a really significant factor, or is it
just, as it were, an anecdotal challenge to figures which otherwise
present a clear picture?
Mr Miller: At this stage we have
no information from the Commission as to the nature of the bids
that they have received; so we just have no way of knowing.
Ms Ardill: Another important factor,
I think, if contracts are awarded, is what size they are, the
number of new matter starts that are involved—because, of
course, a provider with a large contract can take more cases,
has greater capacity.
Q72 Chairman: You mention the tolerance
system, which to my mind is quite important in rural areas, because
without the tolerance system enabling solicitors to provide advice
beyond a specialist area that might mean there is no-one in a
rural market town, for example, who can provide legal advice for
the sort of applicant who lives there and finds it very difficult
to travel a long distance?
Ms Ardill: I think there are some
quality concerns about tolerance work precisely because firms
are providing that work without the benefit of a specialist supervisor,
but, given that there are inevitably shortfalls in rural and market
town provision, the tolerance system has been very valuable in
plugging those gaps, and I think it would certainly be the case
that if any of those firms were to withdraw from legal aid, and
it is said that some do not actually need the legal aid work to
survive, that would leave quite serious access gaps, not only
in the area of law in which they specialise, but in the subsidiary
areas in which they conduct tolerance work. The quality concerns
remain, but if firms were to make better use of second-tier support
services, which the Commission has been piloting and plans to
roll out nationally in April, we understand, there is a possibility
that tolerance work could be of a more acceptable standard, or
a more reliable standard, one should say.
Q73 Chairman: Does the loss of family
law contracts have an adverse effect on the availability of skills
in social welfare law generally?
Ms Ardill: Our understanding is
that a large proportion of firms that provide social welfare tolerance
work in rural areas have got a specialist contract for family
law, so in a sense they are the backbone of the Community Legal
Service in rural and market town areas.
Mr Smith: Indeed, the pattern.
. . You were asking about the significance of the change. I think
it is undoubtedly true that practitioners have cried wolf too
often about pulling out of the system, but, when the Access to
Justice Act came in and the contracting system came in, you had
a massive cut in the number of firms providing legal aid, which
is not necessarily bad—I would have thought overall it was
probably good—and now what you have is the settling down
of the system; but, as you look at it now, in fact family law,
in terms of cases, the family law cases have kept up and we are
back to a system which in some ways is very much like it was 30
years ago: Civil Legal Aid is dominated by family law, which is
its backbone.
Q74 Chairman: Is the growth in the
Criminal Defence Service budget having an adverse effect on Community
Legal Service funding?
Ms Ardill: I think the problem
is that the Criminal Defence budget is not one that can be easily
capped, because, of course, we have obligations to criminal defendants
under the Human Rights Act and if the defence budget is growing
organically, often because of pressures from changes in the Criminal
Justice System which are outside the control of the Legal Services
Commission, then I guess the Commission has no alternative but
to seek to make savings elsewhere. It seems very important that
across Government as a whole there is acknowledgment of the pressures
placed on the legal aid budget from policy changes in other Government
departments.
Mr Smith: The problem is that
the Access to Justice Act allowed the capping of the legal aid
budget overall, effectively, and civil is being squeezed. Crime
is the court but it is not necessarily the fault of the crime,
and you can see that stance. There is this massive pull out of
legal aid, a diversion into advice and an overall squeeze on the
budget. I think it is these conflicting pressures that allow the
Legal Services Commission to come to you and say that the world
has never been rosier, and you will no doubt get a trail of demoralised
practitioners in every sector who will say that it could be significantly
better.
Chairman: Perhaps I should qualify the
ascription to such an optimistic view. That is sometimes the view
ministers appear to give in the despatch box about the state of
things and the number of applicants!
Q75 Mrs Cryer: Do any of you have
any evidence that the system of matter starts impacts detrimentally
on access to justice?
Mr Miller: I would say, yes. The
key example, I think, is the survey that was undertaken by the
Law Society Gazette in conjunction with ourselves and the Criminal
Law Solicitors Association. This showed that a substantial proportion
of firms over the course of the past year have had to turn clients
away because they have run out of contract capacity. It was as
early as last summer that I was starting to get reports from firms
that they had run out of matter starts and would not be given
additional matter starts. So that meant that even though they
had contracts in the field of law and could do work under a legal
aid certificate they were not able to take on new clients at the
initial level.
Ms Ardill: If I might add to that.
A further concern is that if private practice firms are going
to behave in an economically rational way, which, of course, they
can be expected to do, they are perhaps likely to choose cases
for each matter start that are likely to be substantial in nature,
that are likely to run longer: because in that way they can maximise
the income from each matter start. I am not suggesting for a minute
that they are wrong in choosing more complex cases, because they
will be the clients who have the greatest legal need, but the
economic rationality of their decisions on choosing cases cannot
be ignored. I think that is another flaw in the matter start system.
Mr Smith: I would add that the
matter start mechanism is the rationing mechanism which was introduced—that
is what chokes off demand. So in terms of evidence, there is certainly
high anecdotal evidence of firms running out of matter start;
and if you talk to almost any practitioner they will say their
receptionists are passing people around. So you get the hand of
bureaucracy, a sort of Stalinist controlled economy model, directing
people around and choking off demand, and that is inherent in
this rationing system.
Mr Miller: I think it is also
interesting to see the way that different firms have responded
to the challenge of the matter start limit. At the beginning of
the current contract year the Commission said that firms should
work on the basis that there would be no more matter starts available,
that this was an annual allocation. Firms therefore had a choice
as to how they adjusted to this. They could, for example, choose
take on a set number of new clients each month, they could perhaps
decide to take on only the more complex matters or specialise
within a particular sub-category of the field of law, for example,
doing only matters relating to children in family law, or something
like that. In fact, the way that most firms have operated, although
they may have introduced some additional criteria, on the whole
the response has been to carry on taking on clients as and when
they turn up with the need; and the result of that is that firms
do run out of matter starts. Rather than rationing them over the
course of the year and turning away more clients during the whole
of the year, it means there is a huge number of clients being
turned away in the later stages of the year.
Ms Ardill: Another concern, I
think, is that some firms have been completely wrong-footed by
decisions being taken by the Commission's regional office to take
away matter starts from them in the middle of the contract year,
which means it is very difficult for them to plan.
Q76 Peter Bottomley: Is that done
on competence, or is it done on budgets?
Ms Ardill: On reallocation of
resources.
Q77 Peter Bottomley: Budgets?
Ms Ardill: If there are only a
fixed number of matter starts and the Commission's perception
is that those matter starts are needed more in another category
of law or another area, then the removal of matter starts from
one firm to give them to another is—
Q78 Peter Bottomley: So it is not
only a calendar lottery, it is also a subject lottery from the
point of view of the potential client?
Mr Miller: Potentially, yes. To
take one example, one firm contacted me. They had had someone
away on maternity leave for a period of time and therefore had
not taken on as many matters as they expected to. The Commission
reduced their number of matter starts, recouped the matter starts
which had not been used, which for that firm gave them a new baseline,
which was the permanent baseline for that firm's contract business
position, and reallocated those matter starts, and the regional
director would then be free to allocate those matter starts either
to the same field of law with another firm or to a different field
of law.
Q79 Mrs Cryer: So you are all critical
of the use of matter starts. Have you thought about another way
of controlling costs other than matter starts? Is there another
way round this?
Mr Smith: There are two, I think,
at least; and I will give my colleagues a bit of time to think
what their response is. Matter starts are clearly a way of controlling
costs, and it is very effective. It means the hand of bureaucracy
can manipulate with some care. It can release 20,000 in November
if it has the money, and so on. There are two other ways. Historically,
the way it was done was more open, and I preferred it that way,
but it was not done sophisticatedly enough, and you juggle scope,
eligibility and the other variables in an open set of regulations,
and you, as the Government department, estimate demand and manipulate
it in relation to those variables throughout your control. It
was never done—. The DCA, as it now is—never as the
LCD in those days—had the sophistication to do it well enough,
so it was always out in its estimates, and I can understand the
Treasury's concern at that, but what you had then was a system
of rights-based entitlement in which a person could say, "I
have a reasonable case. I am within the eligibility limit. I am
entitled", and there is a great strength to that, which we
have lost, and personally, if we lived in an ideal world, I would
go back to that but with a more sophisticated department. The
other way is instead of buying cases you could buy bodies—and
this is the GP contract. There is a potential problem with that.
You are dealing here with private practice. Of course, the mix
of private and public is very topical and fashionable, but it
is fraught with problems, and private practice is unavoidably
a mechanism for maximising economic profits. The problem about
buying bodies in private practice is that the economic incentive
will be to maximise the profit from that rather than the service.
So I have a bit of a problem about GP style contracts within the
context of private practice. Where I do think they have proved
to work very well in this country, and in others, is if you buy
bodies within the "not for profit" sector where you
have a countervailing culture which keeps the body orientated
to maximum productivity.
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