Evidence submitted by the Law Society
INTRODUCTION
The Department for Constitutional Affairs has
announced its intention to introduce a draft Criminal Defence
Service Bill containing proposals for changes to the Criminal
Defence Service grant of the right to representation. It has issued
a consultation paper setting out the Government's proposals for
these changes and has invited comment on the shape that the new
scheme might take. The provisions fall broadly into two parts:
The reintroduction of a financial eligibility
(means) test.
A transfer of the authority to grant the right
to publicly funded representation away from the courts and into
the scope of the Legal Services Commission.
The aim of the measures, according to the consultation
paper, is to bring greater consistency, a control over grant and
a quicker reaction to changes within the criminal justice system.
The purpose of the Bill, as set out in the consultation paper,
is to achieve "best value for money" for the taxpayer
from the Criminal Defence Service. The paper recognises the tension
between protecting the fundamental rights of the individual and
the Government's responsibility to achieve improved management
control over the legal aid system and the way in which the fund
is spent.
At present, there is no means test for criminal
representation or advocacy assistance before a court. Free advice
and assistance, or advocacy assistance, is available to anyone
arrested and held in custody at a Police Station, or who appears
before a magistrates' court or the Crown Court. However, where
representation is granted for cases that proceed to the Crown
Court, the court can order a convicted person to pay all or part
of the cost of the case—known as a Recovery of Defence Costs
Order (RDCO).
Currently, the magistrates' courts have responsibility
for granting the right to funding under the Criminal Defence Service.
This can either be an order for representation in the magistrates'
court or for a through order to the Crown Court. The Bill will
enable the power to grant a right to representation to be transferred
from the courts to the Legal Services Commission.
The paper sets out a number of models as to
how a reintroduced means test could operate. The Bill itself is
only an enabling Bill and the detail of how the two schemes will
operate will be set out in regulation.
SUMMARY
The Government must look at innovative ways
of tackling spending on criminal legal aid, whilst holding firmly
to the principles of innocent unless proved guilty, fair trial
and equality of arms. In doing this, the Government needs to engage
with lawyers and other stake holders in undertaking a strategic
review of its criminal justice policy in an effort to ensure that
the needs of victims are met; that defendants are given a fair
hearing; and that the criminal legal aid budget is brought under
control.
COST DRIVERS
The consultation paper is clear about the need
to bring greater consistency, better control over grant and a
quicker reaction to changes within the Criminal Justice System.
These are laudable aims, with which we agree. However, it is equally
important that the major cost drivers in the Criminal Justice
system overall are identified, as it is these that will continue
to lead to significant budget overspending on criminal legal aid.
We have identified failings in other parts of
the Criminal Justice System that need to be addressed, both the
police and the prosecution need to be included in any attempt
to identify where costs are being incurred. Equally, the Government
has consistently failed to assess accurately the impact of legislation
on the Criminal Justice System and the subsequent increase in
the costs to the legal aid budget. The Government must act to
tackle these issues. We also urge the government fully to implement
its proposals to reduce the cost of Very High Cost Criminal Cases,
which take up more than half of Crown Court expenditure.
MEANS TEST
The proposed reintroduction of a means test
is welcomed in principle by the Law Society, if it ensures that
those defendants who can afford to pay their legal costs do so,
and that those most in need of help continue to have access to
justice.
However, the administrative system of means
testing must be cost effective, so that any savings are not swallowed
up in additional bureaucracy. Furthermore, it must not place an
additional bureaucratic burden on solicitors, already weighed
down with the administration involved in operating the General
Criminal Contract.
TRANSFER OF
GRANT OF
REPRESENTATION
The Law Society supports greater consistency
of decision making in the grant of representation, but we have
doubts as to whether the proposals in the consultation paper will
lead to a reduction in the number of representation orders and
therefore reduce the cost to the criminal legal aid budget.
We are also concerned about conflict of interest
problems that might arise as a result of solicitors' involvement
in the grant of representation. It must be wrong in principle
for a solicitor to decide whether or not a case merits representation
in the interests of justice and then have the opportunity of representing
a client on a privately paying basis if the client turns it down.
We also have concerns about the transfer of
this additional risk to the solicitor, as it would inevitably
increase the amount of bureaucracy to which they are subject.
Instead of a situation where solicitors might anticipate a move
towards reduced auditing and a reduction in bureaucracy that would
accompany it, they will find themselves being audit controlled
for an aspect of work that was previously the remit of the courts.
QUESTIONS RAISED
BY THE
CONSTITUTIONAL AFFAIRS
COMMITTEE
Why has there been such a large increase in spending
on criminal legal aid?
The Criminal Defence Service was established
under the provisions of the Access to Justice Act 1999. In introducing
the Bill to Parliament, the then Lord Chancellor described its
broad goals:
"The state, in the public interest takes
accused people to the criminal courts, where they may be deprived
of their liberty. So it is right that the State should provide
high quality defence services to those who cannot afford to purchase
defence services for themselves. There should be equality of arms
between prosecution and defence."
Key drivers in the cost of criminal legal aid:
— Increasing professionalisation of
the magistrates' court service
— The Government's commitment to tackling
crime
— Failures of other parts of the Criminal
Justice System
— Very High Cost Criminal Cases
CRIMINAL DEFENCE
SERVICE AND
CROWN COURT
PAYMENTS AS
A PERCENTAGE
OF TOTAL
NET SPEND
ON LEGAL
AID
| Year | CDS PaymentsNet £ M (1)
| Crown Court and HigherCourts RepresentationNet £ M (2)
| Total Net Spendon Criminal LegalAid £ M
| Total Net Spend onLegal Aid £ M
| (10 + (2) as a % ofTotal Payments |
| 1999-00 | 411 | 374
| 785 | 1,552 | 50.6
|
| 2000-01 | 450.4 | 422.0
| 872.4 | 1,664.4 | 52.4
|
| 2001-02 | 508.3 | 474.1
| 982.4 | 1,716.9 | 57.2
|
| 2002-03 | 526.4 | 569.3
| 1,095.7 | 1,908.6 | 57.4
|
| | |
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The above table sets out the significant increase in Criminal
Defence Service and Crown Court payments since the last year of
the Legal Aid Board and following the introduction of criminal
contracting in April 2001. The table also shows that the criminal
budget has, as a percentage of the total net spent on legal aid,
increased steadily in the last four years. This is a reflection
of the need to ensure proper access to justice and equality of
arms for those facing criminal investigation and prosecution,
and demonstrates that, at least in the short term, the criminal
legal aid budget is likely to continue to be demand led.
INCREASING PROFESSIONALISATION
OF THE
MAGISTRATES' COURT
SERVICE
Over a period covering at least the last 30 years, there
has been a trend toward increasing numbers of cases in the magistrates'
courts being legally aided. This is largely the result of the
increasing professionalisation of the magistrates' courts service
and the reluctance of magistrates and their clerks to allow unrepresented
defendants in serious matters. This has had the consequence of
uncertainty about how far the clerk should help the defendant,
rather than merely acting in support of the Bench. Undoubtedly
the introduction of the Human Rights Act has contributed to the
trend, as it reinforced the importance of proper representation
wherever defendants were at risk of serious consequences.
THE GOVERNMENT'S
COMMITMENT TO
TACKLING CRIME
The impact of the Government's commitment to tackling crime
must also be recognised. In pursuit of its long term aim to reduce
crime, the Government has not only introduced new and tougher
penalties for existing crimes, but has also created many new criminal
offences.
In addition, a series of late measures introduced to the
Criminal Justice Bill (now the Criminal Justice Act 2003), including
tougher sentencing powers and bail conditions, will impose further
pressures on the legal aid budget. An entirely new sentencing
framework will be put in place as a result, with a new range of
sentences designed to give sentencers added flexibility in imposing
a sentence best suited to the needs of particular cases, such
as a "custody plus order" and a "custody intermittent
order". On bail, defendants will have a new limited right
of appeal to the Crown Court against magistrates' imposition of
conditions on grants of bail and a prosecution right of appeal
against the grant of bail will be extended to all imprisonable
offences. In addition, a number of pilot projects, including the
street crime initiative and extended sitting hours, are all underway.
Inevitably, these will have knock-on consequences for the criminal
legal aid budget.
FAILURE OF
OTHER PARTS
OF THE
CRIMINAL JUSTICE
SYSTEM
The Government must recognise that criminal legal aid is
an integral part of the criminal justice budget as a whole. It
cannot be tackled in isolation from other aspects of the criminal
justice system. It must not be forgotten that no matter how hard
the Department for Constitutional Affairs strives to bring the
budget under control, part of these costs is attributable to failings
on the part of the prosecution, be it the Police, or the Serious
Fraud Office. Additionally, proper investment in technology in
the courts could save much valuable court time. Unless the Government
achieves real efficiency across the justice system, these costs
will continue to increase and impact on the civil legal aid budget.
VERY HIGH
COST CRIMINAL
CASES
The consultation paper acknowledges that the most expensive
1% of cases in the Crown Court consume a disproportionate amount
of expenditure; currently 51% of Crown Court expenditure or 24%
of the entire Criminal Defence Service budget. Fees claimed by
QCs make up a significant proportion of the costs of these cases.
This figure has increased significantly over the last three years
and must be brought under control through a system of contracting.
LEGAL AID
FUND NET
CASH PAID
OUT OVER
LAST THREE
YEARS
| 2001-02 | 2002-03
| 2003-04 |
| £ million |
£ million | £ million
|
| Total legal aid fund (exc Asylum) | 1,587
| 1,733 | 1,896 |
| % Annual growth | | 9%
| 9% |
| Spend on top 1% of criminal volume | 222
| 264 | 303 |
| Top 1% as percentage of total (exc asylum) |
14% | 15% | 16%
|
| % Annual growth | | 19%
| 15% |
| | |
|
Whereas the maximum rate for solicitors acting in Very High
Cost Cases as set out in regulation is significantly below private
charging rates, there have been no such controls on the fees paid
to QCs. The Law Society believes that the government should set
fees for QCs, so that the earnings for those working full time
on legal aid are broadly the same (after allowing for practice
expenses), as a top hospital consultant. This would go some way
to achieving a significant cut in expenditure.
Do the Government's proposals present the best way of controlling
rising expenditure on criminal legal aid, and how effective are
they likely to be in practice?
As we have explored above, there are a significant number
of cost drivers within the criminal justice system, and the Government
needs to address all of them as a way of controlling the rise
in expenditure on criminal legal aid.
The recently announced Fundamental Legal Aid Review offers
an opportunity for a thorough analysis of cost drivers and the
Law Society cautions against any hasty and ill thought out measures
being introduced until that review is completed. The Government
must develop a long term plan to ensure an adequate supply of
good quality advisers so that the most vulnerable people in society
know their rights and obtain legal aid advice.
An example of such ill-thought measures is the scope changes
implemented by the Department for Constitutional Affairs from
17 May 2004 to restrict the scope of criminal legal aid. These
are:
The provision of free legal advice in Police Stations is
now limited in certain cases to telephone advice only. Suspects
arrested for non-imprisonable offences, arrested on a warrant
for failing to attend court, drink/drive offences, and those detained
in relation to breach of bail conditions, will no longer be entitled
to have a duty solicitor attend the Police Station. Exceptions
apply in situations such as the suspect being a minor, having
communication difficulties, or alleging serious maltreatment by
the Police.
Post charge advice and assistance is now limited to one hour
where a representation order is not granted. The Department for
Constitutional Affairs had suggested that there was no need for
post charge advice and assistance as representation orders can
be sought at an early stage. However, the Law Society successfully
argued that this reason was flawed as, for more minor offences,
representation orders would not normally be granted, leaving people
with no access to advice at all, except at the door of the court
where it would be too late to provide effective advice, or to
obtain necessary papers.
Advocacy assistance has been abolished for early hearings.
This means that more defendants will appear unrepresented at first
hearings, and this is likely to increase delays in the magistrates'
courts.
The scope of the court duty solicitor scheme has been restricted
to remove access for clients who are not in custody and who are
charged with non-imprisonable offences. This is also likely to
create additional delays, as defendants need adjournments to obtain
legal representation. This change does not recognise the profound
significance that even non-imprisonable offences can have on people's
lives. For example, loss of livelihood as a consequence of a driving
ban, or the impact of a fine for a person on a low income.
The Law Society expressed concern at the proposed removal
of legal advice, assistance and representation from a number of
areas of the criminal justice system, as it seemed likely to us
that it would result in additional costs, delays and time spent
on cases, due to the numbers of defendants appearing without legal
advice and representation.
EXISTING CONTROLS
The current system of contracting dates from April 2001,
however measures have been introduced previously to control fees
for criminal legal aid work. These include standard fees in the
magistrates' courts and graduated fees for advocacy in the Crown
Court. These have been on the whole, very effective and have enabled
downward pressure to be applied to the budget, without affecting
access to justice.
STANDARD FEES
Most criminal cases in the magistrates' court are remunerated
by way of standard fees. This system of payment has been in place
since the early 1990s and is based on three identified categories
of work. Each category has an upper and a lower fee. Solicitors
are also able to claim an enhanced rate in cases where they can
demonstrate to the Legal Services Commission that the matter falls
within defined criteria. Certain types of cases fall outside the
standard fee regime and these are assessed by the Legal Services
Commission on a case by case basis.
CROWN COURT
GRADUATED FEES
Fees for advocates in the Crown Courts, including QCs fees,
in cases lasting up to 25 days, are generally paid according to
a formula that is intended to predict and control expenditure.
Although it is difficult to calculate fees within the formula,
it does provide some certainty of payment. Currently, fees for
preparation in Crown Court cases are undertaken on a time/cost
basis.
The above mechanisms for predicting and controlling criminal
expenditure have shown themselves to have gone someway to ensuring
predictability about the criminal budget. However, as the budget
continues to rise year on year, it is evident that causes for
the increase need to be sought elsewhere.
How will the reintroduction of a financial eligibility (means)
test affect access to justice?
It is argued by the Department for Constitutional Affairs
that the reintroduction of a means test will focus resources on
those that need help the most. Means testing will ensure that
those defendants who can afford to pay their legal costs do so,
and that those most in need of help continue to have access to
justice.
The Law Society supports this aim, as those who have sufficient
means to pay for their representation should be required to do
so. It is only right that people with high earnings should be
required to repay the cost of legal aid if they are found guilty
of a crime. Legal aid means testing however, must be set at a
level which would not leave some defendants unable to afford good
quality legal advice. At the same time, the administrative system
of means testing must be cost effective, so that any savings are
not swallowed up with additional bureaucracy. Furthermore, it
must not place an additional bureaucratic burden on solicitors,
already weighed down with the administration involved in operating
the General Criminal Contract.
However, it would be unacceptable for solicitors to bear
the losses incurred in any failure of defendants to pay their
contributions. Whilst it would be reasonable for solicitors to
collect a single contribution at the start of the case and therefore
not undertake any work until that was paid, the risk with what
is proposed is that a solicitor may have to choose between withdrawing
from a case halfway through where a contribution is not paid,
or proceeding and having to bear the loss personally.
How difficult will it be to administer means testing in criminal
cases?
The Law Society's view is that access to justice for those
accused of a criminal offence is paramount. In ensuring proper
access, there is an argument for allowing a system whereby those
accused of a criminal offence who are capable of paying for their
defence should be made to do so. The Law Society was not fundamentally
opposed to the abolition of the means test in April 2001, on the
basis that the administrative cost of the system was considerable
in comparison to the contributions recovered.
ADMINISTRATIVE BURDEN
Bearing this in mind, the Society would want to avoid a scheme
being introduced that would increase the administrative burden
on firms without a significant improvement in the collection of
contributions from clients. The ability to pay must be a key principle,
but the Society envisages some difficulty in the administration
of a means test, other than one, which had as its basis, a very
simple cut off level.
We are concerned that all three models proposed in the consultation
paper place the burden on the solicitor for ensuring not only
that the client qualifies for help, but also pays any contributions
to the solicitor, rather than the court. This means that when
the solicitor submits a bill for payment at the conclusion of
the case, many fees paid would be net of the contribution paid
or due from the funded defendant. We think it is unrealistic to
expect solicitors to have to chase clients for unpaid contributions,
not least because of the additional cost to the firm in so doing.
Whichever of the three models is considered, each of them
is contrary to the spirit of reducing bureaucracy, which the Law
Society has been keen to promote in conjunction with the Legal
Services Commission, as part of the ongoing review of criminal
contracting. The autonomy that has been recently offered to solicitors
in proposed changes to audit procedures and in the Preferred Supplier
Pilot, makes these proposals seem like a retrograde step.
RECRUITMENT AND
RETENTION
The Law Society is also concerned that any increase in the
administrative burden, could have a further adverse affect on
the recruitment and retention of criminal legal aid solicitors.
Qualitative research conducted by the Society in 2003 has
confirmed the existence of serious recruitment and retention problems
in high street firms, many of which are legal aid providers. The
Gazette's 2004 survey shows that 60% of respondents had
experienced problems recruiting lawyers in the last year. The
Society is concerned by growing evidence that legal aid is no
longer viewed as a viable career by those entering the profession.
Preliminary findings of research conducted by the Law Society
in January 2004 show that although, all things being equal (for
example salaries, hours of work, working conditions etc), about
60% of student and trainee solicitors would have been likely to
pursue a career in legal aid, in fact, only about 7% are now likely
to do so.
The Law Society makes the following comments on each of the
three proposed models.
MODEL ONE
This model is similar to the previous means test that existed
in the magistrates' court prior to April 2001. The responsibility
of the solicitor will be to ensure that the legal aid application
is fully completed and is support by the documentary evidence
where necessary. Where previously an application was submitted
to the clerk to the justices or to the court, it is assumed that
this would now be submitted to the Legal Services Commission for
the application to be granted or refused. The scheme has the advantage
of being broadly similar to the previous scheme and therefore
familiar to the majority of solicitors; it would also be relatively
straightforward to administer for firms. The disadvantage is that
in circumstances where the individual has provided evidence that
showed that he could afford to pay for the case himself, representation
would have to be subsequently withdrawn. If this withdrawal of
funding leads to defendants appearing unrepresented in proceedings
where they were previously represented, this will in turn lead
to an increase in the costs of the criminal justice system, negating
any savings recovered by way of contributions.
MODEL TWO
This model is also relatively straightforward in that it
envisages a straight cut off of household annual income of £25,000,
above which an individual would not qualify for public funding.
Individuals in receipt of a means tested benefit would automatically
satisfy the means test, although documentary evidence would still
be required and therefore reservations about this model are the
same as for model one. It would also lead to inequity for those
individuals who had a gross household income of just over £25,000
who would ineligible for public funding, when other individuals
with a gross household of just below £25,000 would be entitled
to public funding.
MODEL THREE
This model is the most complex of the three and demonstrates
that by allowing flexibility, a fairer system can be introduced,
but at the expense of more administration to the solicitor. It
again relies on the solicitor undertaking the means test of the
client and being responsible for ensuring that any changes in
disposable income of the client is reported to the Legal Services
Commission.
As a result of changes to the criminal contracting scheme
since April 2001, solicitors have seen a significant deterioration
of their profitability, whilst their overheads have risen and
there has been no increase in overall remuneration rates for this
work. It is therefore of some concern that they will be expected
to bear the additional administrative burden of administering
the means test, whichever of the three models is deemed preferable.
The Law Society has previously raised concern about the recruitment
and retention of legal aid solicitors, particularly in the area
of criminal work.
Should the authority to grant the right to publicly funded
representation be removed from the Courts and transferred to the
Legal Services Commission?
Whilst the Law Society supports greater consistency of decision
making in the grant of representation, it is unclear whether or
not this will lead to a subsequent reduction in the number of
representation orders and therefore reduce the cost to the criminal
legal aid budget. The interests of justice test will remain the
same and therefore we would predict that there is unlikely to
be a significant reduction in the number of representation orders
granted.
Also, as the consultation paper makes clear, although applications
for public funding will be made to the Legal Services Commission
under the proposals, in real terms that power to grant will be
delegated to solicitors with a General Criminal Contract.
The consultation paper suggests that where the interests
of justice are not satisfied or the individual's means are such
that he or she is ineligible for public funding, the solicitor
will be able to advise the individual whether to proceed by privately
instructing that solicitor or by representing himself. The Law
Society thinks that such a proposal presents an unacceptable conflict
of interest between the solicitor and the client.
The proposed transfer of grant will also have the effect
of transferring the risk to the solicitor. They will be expected
to show that they made "reasonable" efforts to collect
the evidence of means and that any work done was reasonable in
all the circumstances. This will create extra bureaucracy at a
time when there was an expectation that it would diminish significantly.
Solicitors would be undertaking work that was previously the remit
of the courts.
Are solicitors best placed to determine eligibility for criminal
legal aid to grant help to qualifying clients?
In theory, there is nothing to prevent solicitors determining
eligibility for criminal legal aid, in many ways they are well
placed to do so. Our concern however, is the practical effect
of forcing them to do so.
As we have outlined above, the principal objection to solicitors
determining eligibility for criminal legal aid is the possible
conflict of interest that could arise. It must be wrong in principle
for a solicitor to decide whether or not a case merits representation
in the interests of justice and then have the opportunity of representing
a client on a privately paying basis if the client turns it down.
SOLICITORS ACCOUNTS
RULES
There is also a separate issue of whether and how these proposals
might conflict with the professional obligations of criminal practitioners.
A contribution paid by a client would be a payment on account
of costs. Under the Solicitors' Accounts Rules 1998, a payment
on account of costs is client money and must be paid into and
held in a client account. Any contribution should then be transferred
from the client to office account at the end of a case when the
report has been made to the Legal Services Commission and the
solicitor is entitled to his or her costs. A solicitor who holds
or receives client money in any practising year incurs the cost
of the annual accountant's report, and also has to pay the higher
level Compensation Fund contribution.
CONCLUSION
In conclusion, this Bill and its consultation paper is an
opportunity to examine the fundamental problems affecting the
criminal justice system and find innovative ways of solving them.
Unfortunately, what has been drafted appears to be more interested
in obtaining short term savings at the expense of an additional
administrative burden to solicitors.
One approach to the issue of means testing in criminal legal
aid is to return to the pre-1982 position. Under this, there was
a fairly cursory means assessment, but people who obviously had
some wealth could be required to make a down payment at the outset
as a condition of receiving legal aid. At the end of the case
a further contribution could be required. This system operated
in both magistrates' courts and Crown Courts. People whose means
plainly meant they could readily afford the whole costs themselves
could be refused legal aid. This would seem to achieve the objectives
of avoiding wasting money on people who could properly be expected
to afford to pay for themselves, whilst avoiding the complex,
unnecessary burden on solicitors' firms proposed in the current
consultation paper. The one area where the pre-1982 arrangements
were plainly wrong however, is that they permitted contributions
to be required from acquitted defendants.
The Society is committed to working with the Department for
Constitutional Affairs and Legal Services Commission to improve
the criminal contracting regime and it is hoped that due consideration
will be given to the views set out above.
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