Select Committee on Constitutional Affairs Written Evidence


Evidence submitted by the Legal Action Group (LAR 77)

1.  EXECUTIVE SUMMARY

  1.1  The Carter review objectives were to ensure access to justice, deliver greater value for money and a sustainable supplier base. In brief, the aims were given as, "securing value for money without compromising quality and access to legal advice."[20] Legal Action Group (LAG) recognises the difficulties facing the Carter team and notes that the reforms aim to meet the objectives by proposing a phased approach to a radical restructuring of the market. The eventual aim is to procure services based on:

    —  quality

    —  capacity

    —  price

  1.2  In summary, LAG submits that:

    —  the need for some change and reform is accepted but the current difficulties do not result from systemic failure;

    —  the market-based approach is a high-risk strategy; it is not clear that the market will respond in the manner assumed;

    —  the financial objectives are unclear. LAG is not clear that any savings in the criminal legal aid budget will definitely be transferred to spending on civil legal aid services;

    —  the development of Community Legal Advice Centres (CLACs) and Community Legal Advice Networks (CLANs) should be piloted and their usefulness evaluated prior to further commitments for roll-out;

    —  the current proposals are likely to restrict choice and reduce access to justice;

    —  with increasing pressure to drive down costs, the quality of services will suffer;

    —  worryingly, the proposals are likely to have a disproportionate impact on providers from black and minority ethnic (BME) backgrounds and BME communities;

    —  it is perverse that the economic incentive is for providers to act for relatively articulate and educated clients, with cases capable of early resolution, rather than those with more complex needs. This will have a negative impact on many people who are already disadvantaged;

    —  the role of the Legal Services Commission (LSC) within the system, and how it intends to implement a model of best value, is unclear. This leads to incoherence in the implementation strategy;

    —  the current proposals will further damage access to justice for all with potentially dire consequences for the reputation of the justice system.

  1.3  However, should the market-based approach be pursued then LAG recommends that:

    —  a more realistic timetable for reform is adopted—one that allows sufficient time between phases for further research, impact assessments and revisions;

    —  meaningful engagement mechanisms for all stakeholders should be developed;

    —  attention should be given to garnering the views of service users;

    —  the opportunity presented by the Comprehensive Spending Review 2007 (CSR07) should be used to introduce a cross-cutting approach for the co-ordination of all publicly funded advice and legal services.

2.  INTRODUCTION

  2.1  LAG is a national charity committed to improving access to justice, particularly for the vulnerable and socially excluded. LAG does not represent any particular interest group: our primary concern is with quality and access to justice for the users and potential users of legal services. We comment and campaign extensively on social welfare and criminal law issues, on the administration of justice and on the delivery of publicly funded legal services. It follows that we have no direct financial interest in the reforms. Our concern is with the risks associated with the proposals: how these may affect the provider base and, therefore, the availability of legal advice; and the quality of the advice provided.  

  2.2  For ease of reference, and unless otherwise stated, we have adopted the terms "criminal services" to mean the publicly funded legal services provided by the LSC and "non-criminal services" to mean all those services funded by the LSC's Community Legal Service (civil, family, immigration and asylum, mental health).

3.  THE NEED TO MODERNISE

  3.1  LAG accepts the need for some reform but is concerned that the review's starting point was built on the assumption that increases in costs result from "systemic weaknesses in the way legal aid services are procured and therefore inefficiencies in the way those services are delivered".[21] This may be a factor, but it is not the only one. There is a need to address the:

    —  inadequacy of current budget provision;

    —  restrictions on eligibility to legal aid;

    —  need for publicly funded services to breach the gap between current provision and unmet need, including advice deserts;

    —  failure of the legal aid scheme to keep pace with client needs and external drivers such as an expanding list of criminal offences.

  3.2  It is not clear whether the proposals intend to redistribute existing monies or effectively reduce funds across both criminal and civil headings. In some places it seems that the objective is simply to make savings of about 5% on the total budget[22] but it is also suggested that the objective is to rebalance expenditure within the existing budget and that delivering efficiency savings under the criminal heading will allow reinvestment for non-criminal matters.[23]

  3.3  We believe that the cross-cutting approach of the CSR07 could provide a platform for a frank debate about the relative priority given to access to justice issues. The CSR07 process could be used as an opportunity to co-ordinate advice and legal services funding streams across all levels and departments of government.

  3.4  The over-emphasis on the ability of the market to restructure in a fashion that ensures access to justice is a high-risk strategy. Without absolute clarity about available funds, roles within the system and regulatory measures there are potentially damaging consequences for the reputation of the justice system. Failures elsewhere in market-based reform highlight only too well the dangers of relying on predicative restructuring.

  3.5  A key agent in the implementation process is the LSC as the purchaser/commissioning body. We believe that there is role confusion within the LSC. That the LSC wants to act in the best interests of service users is not in question; but the legitimacy for it to determine what is in their best interests is disputed.

4.  THE TIMETABLE

  4.1  Leaving aside questions of whether the market-based approach outlined will improve access to justice, the timetable is too ambitious. The strategy entails radical change and there will be serious consequences of getting implementation wrong. It allows no room for manoeuvre and is out of sync with other developments. We suggest that each phase of the proposals should be evaluated in turn and amendments made in the light of experience and further consultation.

  4.2  Specifically, we recommend that:

    —  any change to payment methods should be deferred to coincide with the preferred supplier scheme;

    —  research should assess the impact of each phase of change prior to the next phase;

    —  the timetable should build in sufficient opportunities for providers and users to discuss impact analysis;

    —  the initial CLACs should be fully assessed prior to further roll-out;

    —  the timetable should be sufficiently flexible to cater for the outcome of any cross-cutting reviews emerging from the CSR07.

5.  BENEFITS FOR DEFENDANTS AND ADVANTAGES/DISADVANTAGES

  5.1  LAG fails to see how the proposals will lead to benefits for defendants. Fewer suppliers of criminal legal aid and larger geographical contracts may translate into clients having to wait longer to see a solicitor. We are concerned that the reality of "advice deserts" for non-criminal matters could now also apply in the criminal field.

  5.2  We wish to register concern that Lord Carter's proposed changes to the General Criminal Contract and associated boundary changes will effectively allow the LSC to restrict choice of a defence solicitor. Given that clients in need of criminal defence services may be facing a loss of liberty, LAG fundamentally opposes the LSC having this right.

  5.3  The proposed fee structures, unified contracts and competitive tendering are all likely to be disadvantageous. We are concerned that they could increase rather than diminish advice deserts; reduce the quality of service that can be provided; and lead to the most vulnerable and needy clients being left without representation.

6.  IMPACT ON DIFFERENT COMMUNITIES

  6.1  LAG is concerned that the vision of fewer, larger, providers and the "efficiencies" associated with fixed fees is likely to impact disproportionately on those residing in rural areas, those from BME communities, people with mental health issues and disabled people. The strategy to reduce the number of providers could easily mean that the provision of face-to-face services in rural locations will be increasingly rare.

  6.2  We suggest that it is a fundamental error to categorise "BME" as a homogeneous group and agree with findings which suggest that adopting a one-size-fits-all approach to BME communities won't work.[24] Even within the review's restricted framework, the available evidence suggests that the proposed move to fewer, larger, providers for criminal work would disproportionately impact on BME controlled firms.[25] There is no reason to presume that the analysis would be different for non-criminal legal aid. Other research indicates a link between the majority ethnicity of firms providing legal aid and that of their clients. This tendency extends beyond binary considerations of ethnicity (white British vs. BME) to individual ethnic categories.[26] It is already recognised that the proposed reforms are likely to impact disproportionately on those from non-white British backgrounds. We do not believe that the approach taken is proportionate or justified.

  6.3  Clients with more complex problems are more expensive to deal with. It is difficult to achieve justice for those with additional needs within a fixed fee regime. Put simply, it takes longer to deal with people with access issues that require adjustments to a standardised approach, for example, dealing with additional communication needs. Thus, it is possible to predict negative consequences for people who may be the most vulnerable in our society. It is a perverse state of affairs that the economic incentive is for providers to act for relatively articulate and educated clients, with cases capable of early resolution, rather than those with more complex needs.

  6.4  There is a need to ensure that there really is sufficient flexibility in the procurement system to cater for particular communities. The rigid approach outlined by the LSC for the implementation of reform does not augur well. We suggest that further impact assessments should be arranged in tandem with meaningful consultation with affected communities.

  6.5  The Carter review recommends that improved stakeholder engagement should be arranged.[27] This is essential for the success or otherwise of the proposals. Adopting an inclusive approach, involving local service providers and user groups, as well as relevant government departments, will bring benefit to the system. Developing structures for stakeholder engagement will improve the reform process and help monitor the impact of change on different communities. Unfortunately, proposals for meaningful engagement with stakeholders are absent from the Department for Constitutional Affairs (DCA)/LSC consultation paper. This is an essential element of modernising the system and we suggest that more thought be given to this aspect of the reforms.

7.  IMPACT ON LEGAL AID PROVIDERS?

  7.1  LAG is not an advice service provider. Our concern is with the effect of change on the ability to access quality advice and representation. The drive for fewer, larger, providers in both criminal and civil spheres affects both legal aid practices and (non-criminal legal aid only) the not for profit (NFP) sector.

  7.2  Initial indications are that many service providers will cease to provide legal aid services. Surveys by the Law Society suggest that current providers expect further reductions in an already tough financial climate.[28] Although these surveys could be viewed with some scepticism it is notable that their key message, that the current proposals are likely to damage an already precarious level of provision, is backed by further extensive and detailed research by consultants.[29]

  7.3  The proposals aim to reduce the number of providers but the vital element missing is an indication of how the market will respond. Will firms merge to form larger, more efficient organisations? Will cartels dominate the market? Will there be new entrants to the market? Will all of this happen at the right time and in the right place? The approach outlined allows only one opportunity to restructure provision. This is a major gamble and should be viewed accordingly.

  7.4  The plans for CLACs and CLANs seem to assume that a number of existing providers can radically alter existing structures and operations within a short-timescale. It is not known how the proposals will impact on existing Law Centres® which receive funding from other major stakeholders including local government. In these circumstances, careful piloting makes sense: it is vital that sufficient time is given to appraise the outcomes of the first phase of CLACs before further roll-out.

8.  IMPACT ON FIRMS OF DIFFERING SIZE, STRUCTURE AND PRACTITIONER MIX

  8.1  Research available to the Carter team suggested that smaller firms undertaking publicly funded criminal work provide good value for money but that their sustainability in the long term is doubtful.[30] Nevertheless, the research also indicated that even large firms struggle to run their crime departments at a profit, despite having low-cost business models. Even these larger firms may not be able to provide a sustainable model without "[a] changed regime for fees or the adoption of an even lower cost base model".[31] It is therefore far from certain that the solution of moving to fewer, larger, providers is either desirable or sustainable. It is also evidenced that that 92% of NFPs would lose income under the proposals unless they increase "productivity" (in terms of number of cases taken on).[32]

  8.2  Thus, for all providers the message is clear: lower the cost base for cases and/or increase productivity. This will impact on both the quality of service provided and access issues for those in most need. To suggest otherwise is folly. The notion that fewer, larger, providers will deliver an efficient, sustainable, and quality service is only a prediction, and a risky one at that. Additionally, the future development of cartels should not be under-estimated.

  8.3  We are concerned that the review has not considered the practical difficulties for providers which are "mixed practices" (part private and part publicly funded legal aid or a mix of criminal and civil legal aid work). Their ability to restructure in line with the current timetable is doubtful, which could lead to them deciding to drop legal aid work with a resultant impact on services available to a given community.

9.  PROVISION OF HIGH QUALITY ADVICE

  9.1  Moving to fixed fees and variations thereof will negatively impact on the provision of high quality advice and representation. The expectation of an increase in the use of paralegals and less qualified staff will impact on quality. The economic incentive will be for providers to deal with cases as quickly as possible. In these circumstances, and with inadequate case funding, it is difficult to see how quality can be maintained. This is particularly disappointing as those involved in the sector have engaged in a drive to set standards and improve the quality of advice provided.

  9.2  It is possible that within a tough financial regime, peer reviewers will empathise with those who are trying their best to provide a service with wholly inadequate funding. Gradually, lower standards among the profession may become acceptable. We are certainly opposed to proposals for different systems for measuring quality between private practice legal aid solicitors and NFP providers and believe that the LSC should keep a direct responsibility for quality issues across both sectors of provision.

  9.3  We are also concerned about the proposal to measure quality on an organisation-wide basis rather than on individual outlets, believing that this has far more to do with administrative convenience for the preferred model of larger providers than any real concern for quality.

  9.4  LAG is not clear what model of "best value" the LSC has in mind? If the principles are those used elsewhere in the public sector (challenge, compare, consult, and compete) rather than the simpler (but less concerned with quality issues) approach of price competition, it is not clear how the LSC will organise this in any meaningful way. What will it consider to be legitimate comparisons of quality and how will stakeholders be meaningfully consulted? Models of best value take time to refine and LAG is not convinced that the LSC has demonstrated the willingness to implement the necessary framework for this model.

  9.5  In summary:

    —  If the proposed fixed fees are introduced then quality will suffer.

    —  The LSC should not devolve itself of responsibility for ensuring quality in the NFP sector.

    —  The quality proposals have been drafted to make life easier for larger providers rather than to ensure quality of advice at the service point.

    —  Further details on how the LSC will facilitate a meaningful approach to "best value" are required.

10.  SUMMARY

  10.1  In summary, LAG believes that the proposed changes to legal aid procurement are likely to impact negatively on access to quality services.

  10.2  We recommend that a more realistic timetable for reform is adopted—one that allows sufficient time between phases for impact assessments and revisions. Meaningful engagement mechanisms for all stakeholders should be developed, with particular attention given to garnering the views and assessing the needs of service users. Further research should be undertaken to fully assess the impact of action on particular communities and localities. The CSR07 should be used to investigate a cross-cutting approach to co-ordinating all publicly funded advice and legal services.

October 2006






20   Legal aid: a market-based approach to reform, Lord Carter's Review of Legal Aid Procurement, July 2006, p21, para 35. Back

21   Ibid, p3, para 6. Back

22   For example: ibid, p3, para 8. Back

23   Legal aid: a sustainable future, Department for Constitutional Affairs and LSC consultation paper, July 2006, foreword by the Lord Chancellor and ministerial team, p3, para. 1.2. Back

24   The Community Legal Service: access for all?, Consumers' Association, 2000, p33. Back

25   Draft impact assessment-criminal proposals: regulatory, equality, rural, legal aid and competition, p10. Back

26   Diversity Report 2005, LSRC Research Paper No 13, Legal Services Research Centre, (2005), LSC. Back

27   see note 1, recommendations 6.3 to 6.5, p 16. Back

28   Impact of pay structures on criminal legal aid work; and Impact of pay structures on family legal aid work, the Law Society surveys, 31 and 21 August 2006 respectively. Back

29   Legal Aid Reforms Proposed by the Carter Report-Analysis and Commentary, LECG Ltd, 25 September 2006. Back

30   Lord Carter's Review of Legal Aid Procurement, 2005 and 2006 Surveys of Criminal Firms, June 2006, Otterburn Legal Consulting, p 31. Back

31   Ibid, p 34. Back

32   See note 1, p106-107, para 64-65. Back


 
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