Evidence submitted by the Institute of
Legal Executives (LAR 162)
INTRODUCTION
The Institute of Legal Executives (ILEX) is
the professional and regulatory body for Legal Executives and
currently has a membership of 22,000 students and practitioners.
Legal Executive practitioners are employed within
solicitors' firms to conduct specialist legal work. They have
a wide range of responsibilities including the following:
— Advice and Representation to clients
accused of serious or petty crime.
— Advice and Representation to families
with matrimonial problems.
— Handling various legal aspects of
a property transfer.
— Assist in the formation of a company.
— Represent clients in the High Court
and county courts.
— Undertake the administration of oaths.
This response is produced by ILEX following
consultation with family and criminal practitioners undertaking
legal aid work.
EXECUTIVE SUMMARY
ILEX makes the following fundamental points
before addressing the joint DCA and LSC consultation paper:
— Fees should not be reduced in anticipation
of future cost savings at a time when firms will be undergoing
costly and risky restructuring needed to stay in legal aid work.
— The transition process is critical
and if pushed through without full consideration of the impact
on suppliers, services will be disrupted; criminal and civil—with
lasting long term harm to clients.
— Proposed fixed fees need to be realistic
and flexible to ensure continued coverage. Adjustments will need
to allow for firm and regional differences and other transition
problems to avoid lasting harm to legal aid provision.
— There is no fall back position in
the event of wide spread loss of suppliers (the knock on effect
would be reduction in the access to justice potentially leading
to market failure in some areas).
— In civil cases, the proposal of an
"escape clause" where cases exceed 4x the threshold
is simply too high. If the proposed fees are based on six hours
work, a practitioner carrying out 20 hours work will still only
receive the fixed fee.
— ILEX is keen to see more being done
to ensure better integration of all relevant participants in the
justice system. It is wholly unfair to expect legal aid practitioners
to make significant changes to their practices without a similar
commitment from other participants of the justice system.
— ILEX believes that the removal of
the uplift on fees in civil cases is a negative move. There is
no guarantee that the development of peer review will achieve
the required standards as currently achieved by Panel Members.
KEY OBSERVATIONS
Responses to the consultation questions are
dealt with later. The following observations highlights the key
issues ILEX members have raised.
1. Legal Aid remains the cornerstone of
our justice system, providing help and assistance for many of
the most vulnerable members of our society. However, we have seen
a 35% rise in the overall legal aid budget, while at the same
time spending on civil legal aid, excluding asylum, is down by
a quarter[100].
Moreover, the supplier base is getting smaller and the age profile
of legal aid practitioners is getting older; there is little incentive
for indebted law students to be attracted by legal aid work when
rewards in the private and commercial sector are much higher[101].
This in turn is damaging access to justice for many of the most
vulnerable in society. The Carter Review proposals are an important
step for reform of a system that has been a concern for Government,
legal aid practitioners and the public. To this end, ILEX agrees
that reform of the legal aid system is necessary to ensure sustainable,
high quality legal aid services at an affordable cost to the tax
payer.
2. Lord Carter's final report raises many
issues. Moving forward it includes significant risks, especially
because of the scale of reform and the speed of transition. If
overly disruptive, the changes could cause irreparable harm to
legal aid service provision. This concern is essentially twofold:
— Suppliers not having enough time
to implement the necessary business changes to survive in the
new environment even assuming the proposed fees are viable; and
— What fall back positions may be available
in the event of wide spread loss of suppliers (the knock on effect
would be reduction in the access to justice potentially leading
to market failure in some areas).
3. Furthermore, questions remain about the
extent to which the aims and potential benefits of a market based
model can be achieved in practice. The government via the LSC
will remain the sole procurer of legal aid services. If it does
not like the prices determined by the market there would be a
temptation to circumvent them and continue to place caps on prices.
For a market based system to be truly effective, the government
may need to be prepared to accept what the market dictates.
4. There is a risk therefore that implementation
may not achieve the market based ideals as envisaged by the reforms,
and as a result disturb the system unacceptably and fail to resolve
the underlying issues of cost, quality and sustainability. These
are far reaching reforms that need to be analysed carefully.
5. ILEX recognises that in a time of finite
public resources, no government can afford to ignore the spiralling
cost of legal aid expenditure from what is essentially a limited
pot of money. ILEX believes the changes, however, must be managed
in a way that ensures continuing quality and choice for clients,
while giving the professions time and, where appropriate, support
to adjust to the new regime.
6. ILEX therefore welcomes the opportunity
to assist in an exploration towards improvements in the way publicly
funded legal services are procured by the state and in the implementation
of the proposals themselves. ILEX recognises that we need a system
that is not only financially sustainable in the long term, but
meets the objectives of ensuring good quality service provision
to those who need it the most. Lord Carter's proposals, if implemented
with care and sensitivity could offer just that.
7. ILEX recognises that the Carter report
is not all "doom and gloom" and together with Clementi
proposals opens up further opportunities for ILEX. Amongst other
things, the relaxing of the duty solicitor requirements will open
up opportunities for legal executives to carry out telephone and
police station advice work, thus creating competition, diversity
and career opportunities for Fellows. This is also consistent
with the increase in the rights of audience that Fellows will
enjoy from January 2007.
8. Notwithstanding the increase in opportunities,
ILEX is disappointed to note the Carter report makes various erroneous
assumptions that solicitors are the sole providers of legal services
in the legal sector. This is simply not true. There is now a diversity
of legal aid practitioners, including Legal Executives, contributing
to the provision of good quality legal advice to some of the most
disadvantaged sectors of the community. Legal executives, for
example, are highly trained specialists undertaking a variety
of legal work on behalf of clients. The skills base is maintained
by regular Continuing Professional Development courses both in
substantive areas and people skills training. Many Legal aid recipients
are amongst the most vulnerable members of our society with high
dependency needs; they may be immigrants, dyslexic, incapable
of expressing themselves clearly (orally or in writing) or have
severe mental health problems, but the significance of this appears
to be lost on Lord Carter. ILEX is of the view that it is not
only the legal qualifications of the practitioner that are important,
but also the interpersonal skills required to support some of
the most vulnerable people in our society. ILEX Fellows therefore
have an important role to play in the future of legal aid provision
with quality at the forefront of service provision.
FIXED FEES
IN CRIMINAL
AND CIVIL
CASES (COMMON
ISSUES)
9. The Carter proposals rely fundamentally
on greater use of market forces for the provision of incentives
and opportunities for suppliers to provide more cost effective
and predictable services. The end game of the proposals is best
value tendering. In the interim, however, the proposals will introduce
fixed or graduated fees for legal aid suppliers. ILEX has no objection
in principle to the concept of fixed fees. ILEX is of the view
that the imposition of fixed fees (in civil and criminal areas)
can be made to work as long as they are fixed at a reasonable
and sustainable level. ILEX believes the following factors are
important in determining sustainability:
— Adequate supplier base.
— Quality of service provision.
— Reasonable profits at market equivalent
rates.
— Attracting new entrants in the sector.
10. Indeed, the advantages of fixed fees
have been recognised in the corporate sector, where firms tender
bids on a fixed fee basis. Fixed fees can promote efficiency in
the provider firms, together with reducing the cost and complexity
of LSC administration.
11. Despite the potential benefits, ILEX
is concerned that the proposed fixed fees include significant
risks to the long term provision of services that could threaten
the proposals objectives, leaving gaps in legal aid service provision.
For example, even modest reductions in fees could sound the death
knell for many firms and thus compound the pressure on a legal
aid system that is already in a fragile state[102].
ILEX is keen to see therefore that the new fees proposed for police
station, magistrates' court and Crown Court, as well as those
proposed for civil and family work, are pitched at a realistic
level.
12. Qualified legal aid practitioners, including
legal executives, must be fairly remunerated and given a real
prospect of improvement in their terms and conditions. Otherwise,
there is a very real danger that firms will employ cheaper, and
therefore less qualified staff to undertake publicly funded work
or depart from the publicly funded sector altogether.
FIXED FEE
ESCAPE CLAUSE
13. The proposal of a threshold for an "escape
clause" in family law where cases exceed 4x the fixed fee
is simply too high. This expects lawyers to gamble on escaping
the fixed fee when ultimately the arbiter will be the LSC in assessing
the bills. This reasoning is flawed. There is no reason why a
2x system with assessment by the courts could not be implemented.
The courts have assessed bills for years so the system is already
in place. The danger also is that clients with complex or novel
cases will find it increasingly difficult to find legal aid lawyers.
STEADY STATE
14. At steady state it is important to have
safeguards in place to ensure suppliers do not offer services
at unsustainable or unrealistic prices, thereby putting at risk
the entire supply base. There is a real danger here that quality
of service provision would be undermined; the interests of the
firm (in achieving throughput) directly conflicts with the interest
of clients. This it is submitted would not be good for quality
or the consumer. This is contrary to Lord Carter's aim of putting
quality at the forefront of legal aid provision.
BETTER INTEGRATION
13. As we move into the implementation phase,
ILEX is keen to see more being done to ensure better integration
of all the relevant participants in the justice process. There
is need to tackle inefficiencies in the system: for example, inefficiencies
in court, at the Police station, the Crown Prosecution Service
and the LSC. Although, Carter recognises the importance of greater
communication and integration between all agencies involved in
the charging process, the final report fails to give a firm commitment
in reviewing and tackling these wider inefficiencies in the system.
It is wholly unfair to expect the legal profession to make significant
changes to their practices without similar commitments from the
other participants of the justice system. This reinforces the
view of many that the legal aid sector is being disproportionately
penalised for systemic inefficiencies in the system as a whole.
GRANT AID
14. The Carter review envisages some grant
aid support during the course of the phased implementation. However,
ILEX is concerned that the £10 million envisaged (which covers
expert and managerial advice, together with match funding for
IT up-grades) is modest compared to the scale of reforms and the
attendant risks. Moreover, the requirement of match funding (which
will invariably involve firms taking on a fund raising role),
may mean that take-up of this grant will remain low.
QUALITY ASSURANCE
AND SELF
REGULATION
15. ILEX endorses the proposal that all
suppliers wishing to undertake publicly funded work should pass
a strict quality threshold. ILEX agrees that the client should
have the confidence in the quality of legal advice and assistance
they receive which will help to contribute to their overall sense
of trust in the justice system.
16. The proposals envisage professional
bodies monitoring quality in accordance with guidelines set by
the LSC. There appears to be a separation of responsibilities,
in that the LSC remains responsible for value for money issues
in defining the standards while the regulators conduct quality
audits and up-date standards as conditions change.
17 Self regulation may be effective in monitoring
performance to ensure practitioners meet the required quality
standards; the professional bodies, including the law society
and ILEX, have been doing this throughout their history. ILEX
is concerned, however, that the boundaries of responsibilities
may become blurred. For example, the professional bodies, ILEX
included, cannot be responsible for ensuring value for money or
determining whether a given quality is economically worthwhile.
The risk of responsibility becoming blurred may be increased if
the professional bodies bear the cost of monitoring quality.
18. Care needs to be taken therefore in
designing these arrangements to ensure that the responsibility
for the balance between quality and price is maintained. For example,
the danger here is that firms will have incentives to cut costs
to bid and win contracts and make profits and as such may do so
by reducing quality: thus, the quality standard becomes a minimum
standard rather than a value for money standard. Where cases are
accepted there will be financial pressure on firms to work to
a standard that will satisfy basic peer review requirements rather
than the pursuit of excellence.
PEER REVIEW
AND REMOVAL
OF 15% UPLIFT
19. ILEX believes that the removal of the
uplift on fees is a negative move. Despite the laudable intentions
of peer review, there is little independent evidence to give credence
to the argument that the peer review system will ensure that the
level of quality across the board will be such as to remove the
need for Panel membership or Accreditation Schemes.
20. It is on the background of the above
general observations that the following answers are given to the
consultation paper.
October 2006
100 Hansard: 13 July 2005 column 1511. Back
101
Career Choices in Law A Survey of Law Students Study 50; and Career
Choices in Law A Survey of Trainee Solicitors Study 51 February
2004. Back
102
Carter's final report uses evidence from Otterburn legal Consulting
suggesting that many firms are already floating on the edge of
profitability. Chapter 2 paragraph 43. Back
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