Examination of Witnesses (Questions 200
- 216)
TUESDAY 23 MARCH 2004
STEPHEN IRWIN
QC, ANDREW HALL
QC, ANDREW MCFARLANE
QC AND MERERID
EDWARDS
Q200 Mr Dawson: Where else would
people go? What brings people into this work? I cannot imagine
that anybody else, apart from the judge presiding over this, certainly
not the child protection social worker who had worked possibly
for years on a particular case, would be paid greatly more than
you are talking about there? What bring people into this particular
work and why are we at such a tipping point with the situation?
Mr McFarlane: The thing which
brings people in, speaking for myself but I think for others,
is the acknowledgement that it is extremely important work. I
think it is far more important than whether the court gets it
right that one company is owed so much for the widgets which were
delivered.
Q201 Mr Dawson: Much more interesting.
Mr McFarlane: Much more interesting,
but also much more important. You mentioned adoption and there
is no more draconian order that a court can make in the civil
field. It is important that it is right. It is interesting; there
are interesting cases, human interest cases. It is not for everybody.
Those who have practised at the Bar will know that some people
cannot understand why anybody would do family law because of the
emotional component to it. It is that which draws people in. Certainly
when I started there was some form of relationship—not parity—between
what you would be paid on a privately paying basis for other work
and legal aid work, but that is long gone and is never going to
come back and that is accepted. People who have chosen to be social
workers or doctors go to the hospital, go to join the social services.
People who come to the Bar have trained, they have done a degree,
they have done another year or two training to be a barrister,
a year pupillage, they could specialise in any area of law and
more are choosing to specialise in commercial law or other fields
of privately paid endeavour because they are taking risks as self-employed
professionals and they want to see greater reward. I have particular
knowledge of the Birmingham Bar. There is a big set of chambers
there, Number Five Chambers in Fountain Court in Birmingham which
had a family team of just under 30 people doing the work. It is
now down to 17 and they cannot persuade the pupils to opt for
the family work. Round the corner, is the largest set of chambers,
Rochester Chambers, which has almost 100% practitioners drawn
from the various ethnic minorities; it is a very valuable resource
in the West Midlands conurbation. They have stopped doing family
work altogether because they feel it does not pay. The tipping
point observation is absolutely spot on, if I may say so.
Mr Irwin: I have been looking
at Bar Council fees for nearly ten years. We used to think in
general terms that the privately funded Bar was earning about
twice what the publicly funded Bar was earning. I now think that
it is three times. The differential has doubled over a decade.
Q202 Mr Clappison: You mentioned
one or two geographical examples, but we heard earlier on from
the Law Society that in the North West junior barristers were
doing this work, but that in the South East and London it was
pretty difficult to get anybody to do it at all. Is that your
experience as well?
Mr McFarlane: It is. Anything
I say is anecdotal, but the survey you have in the papers we produced,
which was by Professor Gwynn Davis, shows a difference across
the country and the fall-off from the Bar doing this work was
far more pronounced in the South East because there is more of
a private market of people. Mererid is in chambers in Sheffield
and I suspect the solicitors who have the private cases also have
some of the legal aid cases. You do not want to upset your solicitor
supplier, so you do more of the legal aid work than you might
otherwise do; you might have to if you are going to carry on practising.
Chairman: Mr Cranston was in another
committee earlier, so I am going to have to ask him to declare
his interests before he begins.
Q203 Ross Cranston: I am a barrister
and recorder. I was on a Standing Committee of the House. We heard
from Mr Philip Ely, who is the chairman of the Legal Services
Commission. He gave us some evidence which, not to be unkind,
was acerbic and critical of the Bar. I do not know whether you
saw that evidence. Two points come out of it. The first relates
to the deeming provision and the decision about that in relation
to family work a couple of years ago and now the decision in relation
to criminal work. The first question I would ask you is to build
on what Mr Ely said. Is the Bar actually turning its back on publicly
funded legal work by those decisions it has made? The second aspect
of that question is: to what extent has the removal of the deeming
provision had an effect on the extent to which barristers are
actually doing the work? Has it had a major impact? We have more
experience with the family side since we have just started with
the criminal side. Those two aspects and then I shall go a bit
further with what he told us.
Mr Irwin: In general terms my
first response is that Mr Ely was poorly briefed. This is complex,
so I have done a one-page note for you which is in the extra stuff
I sent. I do not know whether you have had it, Mr Cranston. It
looks like this and is called Cab Rank and Deeming Provision.
We have not abolished the cab-rank rule. You need to see the history
of this. Cab-rank rule means a barrister has to take a case if
they are competent, available, there is no conflict problem or
anything like that and they are paid properly to do it. That was
always part of the cab-rank rule. You did not have to do it if
it was not being paid or was not being paid reasonably. Under
the Legal Aid Act 1974 the test for what government paid you under
legal aid, for solicitors and barristers, was as is set out there.
They had to regard the principle of allowing fair remuneration
according to the work actually and reasonably done. We deemed
all legal aid work to be reasonably paid. We said that because
of this test, because that is what government is supposed to do,
we are telling you that you have to treat every legal aid fee
as being a reasonable fee. That was in the late 1980s. Then in
1999 government moved the goal posts, because they changed the
statutory test away from a reasonable fee or fair remuneration
and they put in what you see in the 1999 Act. When making any
remuneration order the Lord Chancellor has to secure a provision
of services of the description to which the order relates by a
sufficient number of competent persons and bodies. That is market
supply. So they changed from reasonable pay to market supply and
that was the statutory test for the level of remuneration. By
the time they made that change, criminal fees had not changed
since 1995 and then subsequently they were cut by 20% in an important
area of criminal fees. Family cases had been static since the
early 1990s up to the introduction of graduated fees and then
they were cut, as you have heard. So we saw a change of the statutory
test to a market supply test, a diminution and cut in the value
of fees and we were telling barristers on pain of professional
offence that they must do legal aid cases when they were offered
to them whatever the fee. We could not justify that, so we undeemed
firstly in family and then in crime. We are really reverting to
the position we were in before the late 1980s, but we did so because
they cut the fees on the one hand and they changed the statutory
test on the other. We were, so to speak, artificially maintaining
the supply of people doing legal aided work while government had
a statutory test which was based on whether or not people were
doing the work. It did not fit. They introduced a market supply:
we responded "undeemed". The answer is that clearly
in family cases it has had a really dramatic effect in some segments.
The biggest single average cut is in ancillary relief fees, that
is to say the money after a divorce. It is a ridiculous cut because
that area of litigation is a loan. Once the wife—and it
almost always is who is legally aided—gets the value out
of the house, the state is repaid the fees out of the value of
the house which she gets back. So the net cost to the government
is minimal. Despite that, the cut in fees there has produced a
fee gradient where, as Mererid can tell you, on average the privately
funded barrister for the husband is paid three or four or five
times what the publicly funded wife's barrister is paid. Of course
that has produced a dramatic cut and if you look in the survey,
53% of barristers who used to do publicly funded ancillary relief
are not doing it any more.
Q204 Ross Cranston: So you can see
a reduction in the number of barristers doing it, but people like
Ms Edwards actually keep doing it. Is that because they are able
to mix private and public?
Ms Edwards: I can say in terms
of that mix that my private work has gone up. It still only constitutes
20% of my practice, but my private work has gone up since the
graduated fee scheme came in. From my perspective, I do not hold
myself out to be an ancillary relief specialist in that not more
than 75% of my practice is made up of dealing with the ancillary
relief claims. Of the ancillary relief specialists, the survey
which the FLBA conducted showed that 42% of them have stopped
doing ancillary relief publicly funded work. A straw poll amongst
similar chambers, both on my circuit and the Midlands and North
Oxford and North and South Wales, shows that on average a publicly
funded brief for a final hearing in an ancillary relief case would
give you a brief fee of about £300 whereas the private fee
would be £1,000.
Q205 Ross Cranston: I guess it comes
back to Mr Dawson's question. Who is actually doing the work?
How is the work being done?
Ms Edwards: The response I have
had, certainly from the more experienced ancillary relief practitioners
of over 15 years call, is that the more junior members of the
Bar are doing it, certainly outside London. That can cause difficulties,
things perhaps can be missed which a more experienced practitioner
would pick up on.
Q206 Ross Cranston: So the work is
still being done, but it is being done by a narrower range of
the family Bar. Do I have that right?
Ms Edwards: Yes.
Mr McFarlane: Yes, they are doing
work at a level which they would not normally or historically
have undertaken.
Q207 Ross Cranston: Have we had any
indication about the criminal side yet?
Mr Hall: May I say something about
crime? It is very important that the public and this Committee
do not have the perception that the criminal Bar has turned away
from publicly funded work? I have spent 25 years in legal aid
criminal work in a law centre as a solicitor, in a partnership
in a high street as a junior and now in silk. I shall do it until
I turn my toes up no doubt, which will be sooner rather than later,
being Chairman of the Remuneration Committee. There is a very
big distinction between abandoning the cab-rank rule and people
walking away from publicly funded work and undeeming. We shall
continue to do the work, notwithstanding that we are not forced
to do it. All that has been taken away is a professional rule,
which could have me suspended or struck off and which forces me
to do the work at any price. When government insists on a market
mechanism, when it says repeatedly to me in negotiations, when
it talks about cutting barristers' fees by 50%, chopping out £90
million from the Crown Court fees, that the market can bear this,
you cannot have a market if people are forced to do the work and
the only way to respond is to take the manacles off the Bar so
that they are not professionally obliged to take these cases and
then the market will be tested.
Q208 Chairman: We shall be moving
on to criminal legal aid in the context of the government's Criminal
Defence Services draft Bill, whenever we get it.
Mr Irwin: We thought you might.
Q209 Chairman: Clearly in the case
of practitioners it has an impact if they are engaged in both
areas.
Mr Irwin: May I make one other
point about the graduated fee scheme before we leave it? This
is a superb mechanism for the control of spend, which the Bar
invented. We gave it to government, saying that if they operated
this right they would strip out all the admin cost of looking
at each case and judging it on assessment or taxation. They would
get predictability. If they knew the number of cases they could
know the outcome, but they would need to keep up the health of
the system. We are at another—sorry to use the phrase again—tipping
point about confidence in this system. We invented it. They agree
it is the only mechanism they ever found which gave the predicted
results in terms of the way that the pattern of behaviour operates.
Do you understand? This is a standardised fee system depending
on which components you find in which case averaged over the whole
basket of cases. It is quite simple to operate and it can be efficient.
Both in crime and family, if you do not back the mechanism, then
in the end people will lose confidence in using it at all. It
cannot spread.
Q210 Ross Cranston: In another part
of his evidence Mr Ely went one step further because he said that
the Bar is outside the net of proper contractual management. I
think the argument he is putting there is: why cannot the Bar
have the same sort of contractual arrangement that solicitors
have? In other words, the Legal Services Commission would contract
with either a set of chambers or with an individual barrister
and would say that with that sum of money they can go away and
do 20 cases.
Mr McFarlane: I think Mr Ely was
describing the position some years ago. The Bar has gone beyond
contract. We are on a graduated fee scheme. There is no element
of contractual discussion about what we will pay Ms Edward or
people going to a court. It is an automatic fixed fee. If the
case is outside the graduated fee scheme, for the last two years
the Bar has been on a contractual basis, we all sign contracts,
we negotiate what is again a set of fixed fees with the highest
rates for cases—
Q211 Ross Cranston: This is only
family.
Mr McFarlane: Yes, this is family.
Mr Irwin: It is also the big civil
cases.
Q212 Ross Cranston: I think the argument
might have been made in the context of criminal.
Mr Irwin: We are also on criminal
high cost contracts.
Mr Freeman: I just want to put
some figures on it. The position at the moment is that government
spends £320 million on the Bar for criminal cases in the
higher courts, Crown Court and above. At the moment £80 million
of that goes on graduated fee schemes, so it is 40% on graduated
fees with that powerful control mechanism. All the rest, from
1 April, will be covered by the very high cost cases contractual
scheme. So 98% of all the criminal work we do will be subject
either to a fixed fee mechanism or to contracts. The Bar has no
problem with either scheme in principle. We have long acknowledged
the need for accountability, for some element of control in the
mechanism, so it does not run wild and costs go up all the time,
and we provided our agreement to that in principle long ago. The
difficulty is that they are bringing in a contract scheme which
reduces the income in those cases by between 40% and 50% and I
just do not know of any other profession where moving from one
payment system to another reduces income in such a substantial
way. I am surprised that the Legal Services Commission feels that
barristers will still be prepared to accept those cases. It is
a huge, huge cut. We are talking about a target to cut £90
million out of the £240 million they currently spend on big,
big cases. That is 40% being taken away. We accept the need to
control costs in criminal cases, particularly the big ones. We
are co-operating every way we can conceive of with the Legal Services
Commission and the department to achieve savings. We have come
up with some splendid blue-sky thinking ideas, which we have invited
government to look at, in particular in relation to fraud. However,
we have made it very clear to government that with that sort of
cut being imposed on the Bar in a market situation, if the experienced
barristers, who are needed to prosecute and defend these cases—we
are talking about terrorism, we are talking about murders, rapes,
major drug cases—the serious practitioners we all now have
to prosecute and defend those cases, can find an exit strategy
they will be gone. We are desperately worried about bringing people
in at the bottom to commit themselves, as I did 25 years ago,
to this sort of work.
Mr Clappison: May I ask Mererid and you
to comment on one point which emerged from your evidence and which
is implicit in yours as well? Are you worried about the danger
of disparity of representation? Where a publicly funded representative
is, say, prosecuting somebody who is able to pay very much more
for the cost of their defence, will there be disparity of representation
and some possible impact on the quality of justice?
Q213 Chairman: May I remind you that
we are talking here about civil legal aid? The same principle
applies.
Mr Hall: May I deal very quickly
with crime? The prosecution side always lagged behind in their
fees and in the last couple of years one of the good things we
have seen is that they have been brought up to a par and therefore
that problem does not arise as between prosecutors and defenders
in the public market and that can only be a very good thing. We
are very happy about that. The position is very different in family,
where there is a market.
Q214 Mr Clappison: Could Mererid
comment on that?
Ms Edwards: There is very clear
anecdotal evidence that very junior members of the Bar are undertaking
ancillary relief work and are faced by opponents who have at least
15 years' experience and have brief fees which far exceed whatever
the barrister would be receiving. Obviously it is not the disparity
in fees which is the issue, it is the disparity in experience.
Q215 Chairman: Do you get the reverse
argument where the person who is perhaps the father, but not always,
is in receipt of a salary and not qualified for legal aid but
complains that the case is being protracted by the legal-aided
barrister on the other side and he does not have the resources
to pay the kind of fees you are talking about being paid on the
non-legal-aid side?
Ms Edwards: Certainly if you are
conducting ancillary relief hearings under the graduated fee scheme
there is absolutely no incentive at all to make them protracted.
All of our cases now go through mediation, which is the financial
dispute resolution system. The fees paid within that are extremely
low and if the husband has got beyond that stage without there
being some form of settlement, then perhaps the husband needs
to look more closely at his position in that sort of litigation.
Q216 Chairman: Ms Edwards, gentlemen,
thank you very much indeed for your help.
Mr Irwin: May I ask you to have
a look at annex 4 to our solutions and think about BarDIRECT.
It is an innovative idea that we license people who are not solicitors—advice
centres, police forces, probation—to come direct to the
Bar as a way of introducing flexibility. Even more fundamental,
the root of all this is that whenever government looks at legal
aid spend, they think only about fees. They do not think about
what is the basis for their own figures, they do not analyse them.
We have never been able to get a split-down basis of the cost
drivers within the legal aid fee system. Even beyond that, they
do not cost up and down the system. They do not, with Treasury,
consider, that if they do not get a timely domestic violence injunction,
the oncost to the NHS, the oncost to the local authority for care
of not intervening soon enough, nor do they look at the failures
up and down the system if a trial is protracted. If you, by any
good preparation, save a day off the trial, they only look at
the fees. They do not look at the police saved, the social services
saved, the court service budget and all the rest. We cannot believe
the crudity and the lack of sophistication with which they cost
change within the legal service provision budget. You can make
them do it: we cannot.
Chairman: We can make some things happen,
but our record is not totally successful. Thank you very much.
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