Supplementary evidence submitted by the
Rt Hon Lord Falconer of Thoroton, Secretary of State, Department
of Constitutional Affairs (LAR 174b)
Thank you for your letter of 21 February, asking
about the DCA's position with regard to best value competition
for legal aid contracts. In particular, you asked for an undertaking
that my Department would not interfere with the setting of legal
aid rates by the market, and accept legal aid rates above the
levels of the fixed fees to be introduced in the transitional
period.
By allowing the market to set the rates for
legal aid work, through transparent competitive tendering processes,
we will be sure that we arrive at the best prices for the services
we purchase. As I acknowledged when I gave evidence last week,
it is possible that prices could increase in some, limited, areas
as a result of tendering. But where that were to be the case we
would be forced to increase prices administratively (or lose services).
In any event, I think it most unlikely that we will see a general
price increase. We will be extremely vigilant to avoid the possibility
of cartels forming and manipulating prices upwards.
If best value tendering were nevertheless to
lead to overall significant increases, we would have to pay these
rates, That would inevitably give rise to offsetting cuts elsewhere.
I should stress that this is a scenario that is extremely unlikely.
I trust that this satisfactorily answers the
Committee's question.
February 2007
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