Evidence submitted by the Criminal Law
Solicitors' Association (LAR 172)
1. The Criminal Law Solicitor's Association
("CLSA") is the national organisation representing solicitors
working in criminal law. We have more than 1,500 individual members
drawn from the majority of criminal law firms in England and Wales.
We also have members employed in the Crown Prosecution Service.
2. The CLSA, together with its sister organisation,
the London Criminal Courts Solicitors' Association ("LCCSA")
as key stakeholders, play a significant part in the development
and implementation of changes across the Criminal Justice System
("CJS") and in legal aid in particular.
3. Close involvement with The Law Society
enables a consistency of approach wherever possible. The Association's
Chair and Director are members of the Council of The Law Society,
INTRODUCTION
4. In responding to the Committee's invitation
to submit written evidence we will deal with various issues of
principal around Lord Carter's recommendations rather than the
detail of each intended scheme. We are aware of and have considered,
the evidence submitted by The Law Society and in particular the
content of the report prepared by LECG.
THE NEED
FOR CHANGE
5. The CLSA was encouraged by the stated
aim, when Lord Carter was appointed, of a system "fair to
the vulnerable, fair to taxpayers, fair to defendants and fair
to practitioners". Criminal legal aid has lacked clear strategic
direction for many years. Lord Carter's appointment was welcomed.
A MARKET APPROACH
6. The Access to Justice Act 1999 preserved
the right to choice of legal representative. This important provision
was essential from the public interest perspective towards ensuring
confidence in the criminal defence process but it also acts as
a market force amongst law firms.
7. Lord Carter's proposals change the market
from one where consumer choice is the driver to a market controlled
by the procurer and ultimately ending in a process of best value
tendering.
8. There are a number of important consequences
of this change in approach: the dynamics of the current supplier
base, its economic strength or fragility, the need for geographical
spread.
GEOGRAPHICAL SPREAD
9. Criminal legal advice is needed at each
police custody suite and each court. This means that solicitors
and their representatives have to be available where they are
needed across the country. Since the creation of duty solicitor
schemes in the 1980s, firms have been required to have their offices
close to the custody centres and the courts that they serve. This
means that opportunities for savings through economies of scale
are more difficult to deliver except in the very largest conurbations.
10. Creating larger boundary areas in an
attempt to encourage larger firms is unlikely to succeed in most
areas. The cost of the local provision (on a 24 hour, seven days
a week basis) in terms of premises, or the costs associated with
requiring staff to travel long distances instead, even if practicable
in the time pressured custody environment, suggests that the making
of any significant economies of scale is likely to be very limited.
BEST VALUE
TENDERING
11. Lord Carter acknowledges that best value
tendering will not be possible in all areas of the country. We
agree. We believe that those areas which will be found to be suitable
will be limited to the largest urban areas only. Our major concern
in working towards the end state tendering process relates to
the imbalance between the number of contracts and the number of
suppliers.
12. An important aspect of the tendering
process is that a "market price" should ultimately be
paid by the procurer. We do not believe that the Carter design,
even after a transitional period, will allow for a true market
price to be established and that the risk of business failure
will be very high.
13. In other fields of commerce small numbers
of businesses may be in a position to bid for a larger number
of contracts. If, for instance, there are four or five firms bidding
for two or three hundred small contracts, the market size allows
for them to bid at a price which represents the cost of delivery
and an element of profit. Each contract bid represents only a
small part of the turnover of its business. The risk is low.
14. In the case of criminal law firms the
opposite picture is the case. Almost all businesses will be bidding
for one contract each which will represent 100% of its work. All
the eggs are in one basket. The need to secure the contract will
mean that bidders will put in the lowest possible price in the
hope of staying in business. That may be superficially attractive
from the public procurement perspective but it is unlikely that
the firm will survive for very long. The market model should be
about the opportunities to make a profit at best value.
TAKING THE
SAVINGS BEFORE
THE EFFICIENCIES
ARE DELIVERED
15. Driving change where economies of scale
can produce efficiencies is desirable from the view of the procurer
as well as the contractor. The motive for delivery of the efficiencies
is the opportunity created to increase margins and enhance profit.
On their own such alterations to the supplier base can deliver
benefits. Those benefits could be increased profits for the supplier
(or the creation of profit where losses are now being sustained)
and savings for the procurer.
16. There are two areas of concern: that
the supplier should be in control of the cost of delivery (an
aspect that we will consider later) and that the efficiencies
are delivered before savings are taken.
17. Although some of the design changes
have merit, the supervening need for the DCA to use those changes
to design and structure to make savings risks the beneficial changes
and improvements which could flow in some areas. The savings have
become the driving force behind reform, not reform for the benefit
of future delivery. The real flaw is that the savings are intended
to be taken before any of the efficiency gains have been delivered.
18. At the very core of the Carter proposals
is the future viability of the firms who remain undertaking legal
aid work. Irrespective of the ambitious timetable for change affecting
thousands of small businesses, the greatest risk arises from the
determination to make savings regardless of capacity to support
them. We do not believe that the financial basis of these proposals
will produce a sustainable supplier base.
FIXED FEES
IN THE
POLICE STATION
19. The move towards a fixed fee system
will mean extensive change in the way that the delivery of police
station legal advice is undertaken. The process is entirely demand
led and operates on a 24 hour basis. At the moment the input method
of payment (hourly rates) ensures that the consequence of procedural
and other changes across the CJS which serve to bring about delay
(National Charging Standards, awaiting decisions from CPS staff
and CPS Direct, for example) are borne by the state.
20. The fixed fee regime will mean that
the supplier has to bear the cost of any increases in time taken
for the delivery of the advice regardless of the cause. Those
causes may be procedural at the hands of the police or CPS; they
may arise through simple inefficiency on the part of others or,
worse, they may be deliberate acts by police officers in the adversarial
investigative process. The cost and risk of others actions is
transferred from the state to suppliers.
21. At the moment getting staff to work
out of normal hours is not easy but they are paid a share of the
hourly rate derived from their work. Under the new regime staff
will be paid overtime. The consequence is that any additional
costs in terms of time spent through the inefficiency of others
will be reflected in higher staff costs without suppliers having
any means of recouping that cost.
TRAVEL AND
WAITING
22. The principal area of saving is envisaged
through ceasing direct payments for the two categories of travel
and waiting. In the Associations view it is inappropriate to deal
with them as if they are one and, further, the difference in the
arrangements between London and the rest of England and Wales
do not appear to be well understood.
23. Travel time payments might be wrapped
up or incorporated in the overall payment for the work undertaken.
It is significant that the average travel costs in areas all across
the England and Wales (excluding London) are fairly consistent.
This is true regardless of whether the regional emphasis is essentially
rural or urban. The reason is probably that there has been, effectively,
a contractual requirement of the LSC for law firm offices to be
close to the point delivery. It is unlikely therefore either that
travel costs will vary much from one place to another or that
they will provide much opportunity for efficiency gains by relocating.
24. Waiting costs on the other hand are
a reflection of the tensions and requirements of all other agencies
operating together across the CJS, each conscious of its own budget
but rarely mindful of the cost consequences for others. The shift
of risk in the cost of waiting to the supplier has already been
referred to. The same reasoning is applicable in the magistrates'
court as it is in the police station. This time the defence solicitor
bears the cost of delay or other inefficiency of the CPS, Probation
Service, prisoner escort contractors and HM Court Service.
MAGISTRATES' COURT
25. The CLSA urged Lord Carter not to make
change to the current standard fee structure in the magistrates'
court. The current scheme has been successful in keeping costs
under control. More significantly, the extent of proposed change
in practice, procedure and jurisdiction of the magistrates' court
on top of the re-introduction of the Means Test would risk too
much change and a destabilising of suppliers with unpredictable
volumes of work. We consider that there should be no further changes
to fee structures in this area until the effect of all other changes
is understood.
CROWN COURT
FEE STRUCTURES
26. In the higher courts where the more
serious cases are tried, it is imperative that fee structures
are designed to assist justice being served. It is understandable
that there should be a focus upon value for money. It is also
perhaps understandable that, at first glance, payments made on
a time/cost basis of inputs rather than outputs should appear
to reward the inefficient who take longer over the preparation
of the case. We disagree that the current system encourages inefficiencies.
All bills are closely examined as to the appropriateness of undertaking
each item of work, the level of qualification of the fee earner
concerned against a test of reasonableness of time taken. That
detailed and close scrutiny may be expensive but it does allow
appropriate work to be undertaken and paid for in the interests
of justice.
27. The litigators graduated fee as presently
outlined is made up of a base fee and various proxies for work
undertaken against set criteria. There is no payment proxy within
the scheme which adequately reflects the way in which a good quality
active defence is prepared: no payment relative to the need to
take detailed instructions from a defendant on remand in prison,
nothing for tracing or interviewing witnesses, nothing for examining
prosecution unused material. These are just examples of the way
the structure could be said to reward best those who make the
least effort.
HARMONISING ADVOCACY
AND LITIGATORS'
FEES
28. The Association supports Lord Carter's
proposals in this regard. We believe that legal aid work should
be approached in the same way as all other areas of law where
solicitors hold clients' money and negotiate specialist advocates
fees on a case by case basis. It is an effective way of securing
the best advocate for the job at a price which the client can
afford. It seems sensible to us that the added market dimension
will be helpful to secure value for money and at the same time
preserve the specialist bar.
29. Simultaneously, we support the growing
view that rights of audience for solicitors in the Crown Court
should be automatic for all hearings except jury trial where the
current Higher Rights of Advocacy rules would continue to apply.
Such a step would be a natural progression as Fellows of the Institute
of Legal Executives will have rights of audience in the Magistrates'
Court from 1 January 2007.
30. Changes which allow law firms to ensure
that the most cost effective, properly trained personnel attend
to different areas of work would suggest perhaps the greatest
opportunity for productive efficiencies.
TRANSFERRING QUALITY
CONTROL TO
PROFESSIONAL BODIES
31. The CLSA has supported the concept of
peer review as a means of ensuring that clients receive a consistent,
high quality of advice commensurate with the price being paid.
We have two concerns.
32. First, the separation of the quality
check from the price being paid may well further cloud the distinction
between good quality legal advice and a high level of service.
The CLSA believes that good quality advice must be the aim of
the process regardless of price but that the level of service
offered should reflect the price being paid. There is a distinction
between the two that does not appear to be well understood.
33. Once the quality setting is separated
from the price being paid, there is a risk that unachievable high
levels of service will be set under the guise of quality. This
issue is capable of being addressed by a greater understanding
that the standard of service must reflect the price being paid.
We believe it is likely that service levels have been dropping
as the fees paid have remained static year on year. However, we
do not believe that the quality of the advice given has fallen.
34. The second point is that the change
in responsibility amounts to a direct shift in the cost of the
quality checks from the LSC to suppliers at the same time that
fee levels are to be cut after flat cash fee levels, almost without
exception, since 1993.
CONCLUSION
35. The CLSA is keen for change. Change
must be for the better for all, not just the procurer and certainly
not as a disguise for cutting the cost at the risk of a sustainable
and viable legal aid system.
36. Changes must be implemented sympathetically
and within timescales which the market can support. They must
not be imposed in a belligerent and bureaucratic fashion but in
partnership with the profession and professional bodies.
37. The aspects to which we have referred
in this short submission indicate that in looking forward to changes
in design of systems of delivery we are far from convinced that
the proposals achieve the objective of being "fair to the
vulnerable, fair to taxpayers, fair to defendants and fair to
practitioners".
October 2006
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