Examination of Witnesses (Questions 202-219)
DAVID EMMERSON
OBE, RICHARD CHARLTON,
DAVID JOCKELSON
AND ROY
MORGAN
30 JANUARY 2007
Chairman: Mr Charlton, from the Mental
Health Lawyers Association, Mr Emmerson from Resolution, Mr Jockelson
from Miles and Partners and Mr Morgan from Morgans, welcome to
you all. Mr Morgan we have had before us before and we are very
glad to see you back again. You have heard the direction of the
evidence so far and we are going to resume over very similar ground
with Dr Whitehead.
Q202 Dr Whitehead: Without asking you
a question in identical form to the last session, could I ask
for your opinions and views on the fact that, as we have mentioned
previously, the LSC has provided more legal help to more people
last year than in any year since 2000, but there is still evidence
of unmet demand, which we also remarked on in our Committee deliberations
last year. Is it your view that there are, indeed, areas of unmet
need, that there are several Legal Aid advice deserts and, if
there are, where are they and what form do they take?
Richard Charlton: If I start from
the mental health side, I think that from a mental health point
of view there has been an increase in demand. The principal area
coming in the mental health contract are people detained under
the Mental Health Act who are entitled to mental health review
tribunals. Psychiatry is not a certain science, expert evidence
is needed sometimes to challenge psychiatrists' views, Article
5 liberty issues are involved, clients are often very demanding
and it is a matter of fact that more people are being detained
under the Mental Health Act. Our members struggle to meet the
calls for representation for those kinds of people, but it is
becoming increasingly difficult for many of our members to keep
up the struggle. Geographically, I could point certainly to East
Anglia as an area which has enormous difficulties, other areas
includes cities such as Hull and areas such as North Yorkshire.
We have to travel out to see such clients, which is often demanding.
The area of law has developed very quickly in these areas; the
first remedial order on the Human Rights Act was made in these
areas. This is the headline work we do, in a sense, in mental
health in many respects in covering people's calls for representation
to challenge their detention in hospital. Behind that headline
work is an area which is suffering even more and this is, in fact,
the social exclusion area which is supposed to be an area of priority
for this Government and, unfortunately, many of our members really
find it completely impossible to cover this kind of work. The
thing is it is impossible really to stress how important preventing
further increases in claims against the Legal Aid fund and preventing
further, perhaps very critical, problems developing, even to the
point of mental health homicide, are, so these are very unusual.
Aftercare problems are often very difficult to resolve on behalf
of mentally unwell clients. They are possibly the kind of clients
who come to MPs' constituencies fairly frequently.
Q203 Chairman: "Demanding"
seems like a bit of an understatement.
Richard Charlton: We would suggest
that far more of these people are going to be, unfortunately,
knocking on your door perhaps with great bags and papers and so
on as well to try and describe their problems; certainly they
come to our offices and you will know from their visits to your
surgeries the demands they put on us. We are limited as to how
many of these people we can take on. This kind of work tends to
pay less than the mental health review tribunal work. The Mental
Health Lawyers Association did a paper on social exclusion for
the Commission and it was aimed to go to the Treasury about how
a little expenditure earlier on in terms of advice, assistance
and aftercare could prevent, perhaps, enormous human tragedy but
certainly enormous economic cost later on in the system if things
went wrong. Unfortunately, that paper was never even formally
acknowledged. It is an enormous problem and a great tragedy for
our members that work is not being covered. Quickly to go on to
figures, these figures are also the subject, certainly in mental
health, of some manipulation; I am not saying necessarily intentional
at all. For example, in mental health review tribunals we used
also to do work for managers' hearings and that would be one report,
but then we had a direction from the Commission that there should
be two reports for that, so at a stroke the same amount of work
then amounts to two matters. There are various things going on
in terms of apparently increased acts of legal help which I think
do mar the situation.
Q204 Dr Whitehead: Mr Jockelson and
Mr Morgan are what you might describe as specialist and niche
providers. Do you have anything to add?
David Jockelson: I am certainly
horribly specialised in the sense that I only do care work, which
leaves me somewhat exposed. In terms of the number counting, I
do think the point was made earlier, which was extremely interesting,
about double counting. You ring up CLS Direct and you get referred
somewhere else. In fact, Mr Vaz got his office to ring up CLS
Direct not long ago—it is recorded in some minutes of discussions—and
on the third go they finally got through to speak to a human being
who said they could not help and they referred him to the Citizens
Advice Bureau which with that particular query, a personal injury
claim, would not be able to help either, but they tick another
box. If you go down the road to a solicitor you get three apparent
acts of assistance in a lovely language of the Legal Services
Commission, and that would look really splendid in the statistics,
would it not? It would mean absolutely nothing of course. Indeed,
they are probably not eligible for Legal Aid in the end for personal
injury work, so they have achieved nothing in terms of delivery
of service. Perhaps I should also mention there are major queries
about quality issues on CLS Direct. Currently some of the people
who have taken the contracts are advertising for staff, these
have not been peer reviewed, they are setting up afresh, and there
will be a peer review after six months, but they are advertising
for law graduates and, indeed, undergraduates to advise on the
telephone. This does fit in with a document which I have submitted
today about the potential future direction and the fantasies the
Government may have about very cheap and cheerful online, call
centre, paralegal support which will make the figures look splendid
and will not, in fact, deliver the quality that is needed and
it might, indeed, favour, as has been said, the easy-to-help clients
who can use the telephone and the internet. I deal at completely
the other end, I deal with care cases, with clients who are—without
any disrespect—dysfunctional. They come to me late, they
needed advice months ago to understand the significance of Social
Services concerns. I have always tried in the past to do that
under the old Green Form scheme, to go to meetings with Social
Services. That was increasingly uneconomic and I am glad to see
that there is a proposal that there will now be better funding
for that, but that is an area of unmet legal need which is not
on the same map as these advice deserts. These are problems with
people who have got learning difficulties, schizophrenia, personality
disorders or massive drug and alcohol issues which were mentioned
to you a few days ago by Mark Potter as being a driving force
behind things. We cannot ignore the fact that the work we are
doing is in the context of ever-increasing social chaos, if I
can use not too strong a word. My clients are from that area of
the world and the skill and the care they need—it sounds
like I am boasting, I hope I am not—are listening skills,
negotiating skills, persuading skills and then advocacy skills,
not one of those would show up on a peer review. I am not sure
if my files would be as perfect as somebody's down the road who
has a wonderful peer review and does not have the same, perhaps,
dedication. As it happens, we have been peer reviewed and we are
exceptionally good, thank goodness.
Q205 Chairman: They could not possibly
know, could they?
David Jockelson: They could not
possibly know the real issues, but our files are in splendid order
and we send out all the right letters to the clients, some of
them cannot quite understand the letters but never mind. The real
quality of the work is missing from the catchment of peer review.
I am not saying it should not happen, I am just saying it is limited.
It was interesting that yesterday Ed Cape who was responsible
for some of the formulating of it, expressed serious doubts and
had reservations, and I think the President also said that it
could not really pick up on advocacy rather than the skills; however,
I am hogging the microphone.
Roy Morgan: Perhaps I can deal
with the CLS Direct issue as a CLS Direct provider.
David Jockelson: Some are very
good.
Roy Morgan: Thank you. With regard
to the point; "Is more legal help being delivered?",
I think it depends on definition, and on the advice deserts, it
depends where you look. With regard to "Are more people being
helped", I think the figures show that over the last year
the actual spend on legal help dropped from £190 million
to £160 million, which suggests that if there are more cases—however
you define "cases"—being dealt with, and then
being dealt with for a lower cost and at a lower level, that might
suggest cherry-picking. I know you have already had quite a bit
of evidence about that, so I will not go into that. In terms of
CLS Direct, my firm provides CLS Direct services in housing, profit
benefits and debt and we also provide the Welsh Specialist Support
Service in the same categories—and thank you, I think you
have saved it, I hope you have—but there is no doubt that
the CLS Direct service does generate face-to-face advice. Having
said that, the vast majority of calls that CLS Direct in my firm
deals with are dealt with over the telephone and they are often
pieces of advice that can be dealt with in a short space of time.
However, if the case involves court proceedings, such as repossession
action or if it involves something like a Disability Living Allowance
appeal, then that must be referred for face-to-face advice, so
there is inevitably a double counting with those two pieces of
advice.
Q206 Dr Whitehead: Do you have any
feeling for the percentage of the total that the two categories
represent, the category that can be completed over the phone and
the category that then leads to face-to-face advice, and, inevitably,
is double counting?
Roy Morgan: Without being precise—though
I probably could provide you with figures, I will do that in writing
if necessary—from speaking to those people in my firm operating
the system, less than 10% involve face-to-face referral. In terms
of what you have to deal with in that referral it is then a question
of where you send them, and in many areas there is no difficulty
and you can find providers very easily; in other areas, it is
very, very difficult indeed. In Wales once you are looking for
Welsh-speaking providers you have some significant deserts, the
same applies in East Anglia, Cumbria and so on. It is very difficult
to refer on.
David Emmerson: On the family
side, there is no doubt that the number of people being served
is going down year-on-year and that is not assisted by CLS Direct
because it does not offer family services, and the reason why
there are fewer people served is because there was a third less
contracts in family law in 2006 than there was in 2001. Also,
the Commission are going to pilot the idea of CLS Direct services
for family in the new year and we would support that and it is
going to be a valuable information service for the public, but
our view is that it is going to take away a very, very small percentage
of the actual cases that need direct advice from solicitor and
other organisations. You asked about advice deserts. If you plot
a map round the country of all the different contracts in family
law there would be reasonable coverage, but in places like East
Anglia and Wales there would be a fairly clear lack of provision,
but the real issue is what the capacity of those existing organisations
is. Our experience is that firms are not able to use all of their
allocation if a matter starts, they are not able to cope with
the volume of work they are getting in to their offices because
they cannot afford to expand sufficiently to meet the local need,
so, in my view, it is not a question of advice deserts, it is
a question of capacity throughout the country as a whole, and
I think throughout the country there are problems.
Q207 Dr Whitehead: So what you might
say in terms of the general model is the numbers are reducing
but capacity within those reduced contractors is not increasing?
David Emmerson: No. There is no
doubt that there is just the same need for family law advice throughout
the country this year as there was six, seven or eight years ago.
Q208 Dr Whitehead: If that is the
situation now, what is your view about the long-term effect or
the medium-term effect of the proposed reforms on precisely that
relationship of numbers and capacity?
David Emmerson: We conducted a
survey in conjunction with our response to the Carter proposals
and 70% of the people who responded to the survey felt that they
were going to lose out significantly with the proposals as they
were in the format, only something like 7% thought that they were
going to be better off. So those figures alone are going to indicate,
I think, that more and more family solicitors are going to be
turning their backs on Legal Aid. Of course, they are able to
do so because they have the advantage of being able to go into
the private sector.
Q209 Dr Whitehead: Is it your view,
Mr Charlton, that it is going to be a similar situation?
Richard Charlton: Yes, in the
material we have given the Committee there has been around a 25%
fall in the number of specialist mental health solicitors since
the introduction of contracting in 2000 and they are, of course,
trying to cope with an increase of people detained under the Mental
Health Act and say that to the headline representation there,
so the crisis is solved by our members trying to work harder and
faster. Just on my own committee, around a quarter of the members
of the committee have been forced out of their firms as partners
because mental health pays so badly. They now survive as consultants
or are working on a kind of locum basis because it is time consuming
and specialist but the rates, as they stand at the moment, are
so low they cannot hold their own in private practice. Then, of
course, with the uncertainties ahead many are just indicating
in the service, "We do not have members", they are just
going to throw up their hands making the crisis even worse.
David Jockelson: I took the slightly
sneaky line of ringing round the solicitors in the constituencies
of some of the members here, because then you can see that I am
playing straight. I spoke to people in Cambridge and I was told
that a few years ago there were 20 firms in Cambridge dealing
with Legal Aid work and there are now effectively four. I have
spoken to some of them and I would not want to name names, but
some of them are right on the edge, doing less and less. People
talk about a fragile base and you have got The Law Society, who
are pretty moderate chaps really, using words like "meltdown"
and words like that. We are on the edge of a catastrophe and my
question is, how does everybody else see this and the Government
does not? What is it that the Government are relying upon to rescue
them when things go really badly wrong in a year's or two years'
time? It will not just be people with carrier bags with papers
turning up at your surgeries, irritating though that might be,
it will be people not getting domestic violence solicitors—that
has life and death implications—it will be people not properly
represented in care cases, children removed inappropriately or,
when there are not representations for the children and with weak
local authorities, children potentially returned inappropriately
at risk to their lives. We are playing for the highest possible
stakes here with children's lives and the supplier base being
fragile is a euphemism for we are facing a serious, serious disaster.
It is my suspicion that the Government, following the suspicions
of the Chairman, have some fantasy that some cheap and cheerful
system is going to emerge growing out of CLS Direct with a call
centre mentality and Tesco law. I have prepared a paper which
is phrased in relatively dramatic terms compared with representatives
from official bodies. I am here as a single individual, having
spoken to a large number of other solicitors, and the area of
concern is absolutely widespread. The only people who do not seem
to believe it are the Government, so what agenda are the Government
operating on? What do they really think is going to happen in
two years' time? I believe they have an idea that it is all going
to be solved by post-Clementi liberalisation. I have heard the
managing director of Capita Legal Services, which is a huge provider
of local government services, as you probably know, Max Pell,
relishing the prospect of a cull of high street solicitors. He
is going to be doing all the standard work and profitability will
collapse, he reckons, and many of those high street, ordinary
mixed practices have a small Legal Aid practice, often subsidised
by conveyancing and the wills department, and if the high street
has a cull then the Legal Aid elements are going to go as well.
He is helping to run CLS Direct and he has ambitions, I suspect,
to push his envelope further and further into doing it. I am sure
he has told the Government that this can be done very cheaply
and all the advisers, the KPMGs, (CoopersLybrand as they were),
PricewaterhouseCoopers, these consultants who have direct contact
with the DCA, whose original papers triggered off the whole business—and
I do not think you have seen them—are telling Number 11
in particular, "We can deliver many more bangs for your bucks,
much more work for £2 billion", and I believe that is
being accepted. That is an underlying thing which I do not think
is being discussed. These comments are the only references I have
seen, almost, to this Tesco Legal Aid fantasy and I think it is
phenomenally dangerous. You should be asking very penetrating
questions about what the Government really thinks is going to
happen, because it pretends nothing is going to happen. They are
the only people who think nothing is going to happen.
Roy Morgan: Can I very briefly
add to that and give a slightly different perspective to it. There
is a lot of discussion about a picture of what might seem to be
a number of very small practices, which are very vulnerable, juggling
different categories of legal aid work and trying to survive with
a fine balance, we are talking about firms which may in the future
decide to give up. There are a number of people on the Committee
who hail from my part of the woods and they would recognise very
readily the names of two very significant firms in Cardiff which
are very large practices, very well respected, very well run and
very businesslike, and in the last month, and in one case in the
last few weeks, they have made the business decision to give up
both family work and criminal work, effectively giving up all
Legal Aid work together. I am not sure if I should name them,
but I am happy to name them if you wish. I suspect you already
know.
Chairman: Cue Ms Morgan.
Q210 Julie Morgan: I was going to
ask the individual firms what you think the impact of the fixed
fees are and will be on your firms. If I can ask Mr Jockelson
first, what was the impact, if any, of the introduction of the
Tailored Fixed Fee scheme in May 2005 on your firm?
David Jockelson: That, I think,
was not at all unfavourable. The original one was reasonable,
we could live with that. We have done the statistics for the next
stage and, frankly, if it does not change we may as well all go
home because we have done them scrupulously, taking the previous
one, stripping out the VAT, stripping out the disbursement, so
we are comparing like with like. The profit costs for our 210
cases under TFF were about £80,000. Working the figures on
the same cases, in future they will be £50,000.
Q211 Julie Morgan: £50,000?
David Jockelson: £50,000,
so we will lose £30,000 of £80,000. What do you think,
do you think we are going to be there tomorrow? I do not think
so. I am not a housing lawyer, but there is no housing lawyer
here and I have a duty to my colleagues. HALPA, the Housing Law
Practitioners, have given me details of their most recent survey
and it looks like about 50% of their members would have to give
up, 50% of housing lawyers would give up. That is the point being
made, you cannot move smoothly from Legal Aid housing into private
housing, there is no such thing, so they will just do other sorts
of work.
Q212 Chairman: It is actually for
landlords, of course.
David Jockelson: It never crossed
my mind! No, seriously, there is not an awful lot of that sort
of work around, and I do not think most of my colleagues would
want to do it particularly, apart from housing associations maybe.
That is a very, very vulnerable base and they are very much the
sort of people who will come to your surgeries, they are also
people with multiple problems, the sort of people who are not
coping in many other ways, they have got disrepair problems, are
not paying their rent and may have other issues, multiple debt
and so on and so forth, so they will fall through the net comprehensively.
My previous firm used to be involved with the duty solicitor scheme
at Lambeth County Court where you had possession days and you
were really catching people just at the last minute before they
hit the deck. If they had not been there, and it is a very, very
shaky voluntary system, those people would have been evicted—utterly
ridiculous—voluntary costs, they would have eventually been
housed somewhere else, the cost downstream to other budgets would
have been massive, and that is for me a scandal. That is housing.
Personally, I can speak from a care position, because that is
what I do. The original proposals were absolutely absurd. We were
offered £4,000 to do a care case, none of them ever cost
as little as £4,000 and certainly were not small enough for
there to be any so-called "roundabouts". It turned out
later, as Judith Masson explained to you on the 27th, that they
were counting certificates, so if I acted for four children then
my case cost a quarter of what it really cost, so it is not surprising
their figures were completely meaningless and they finally realised
that during one meeting and backtracked pretty radically. They
are now talking about something like £5,000, maybe, with
an escape limit of £15,000. That means if your case has gone
over £5,000 you are into loss, up to really £10,000
worth of loss on a case. How can you possibly tolerate that? Care
cases come in large lumps like that, you cannot mass produce care
cases, and nor should you. In fact, it would be a perverse incentive.
If they are that cynical about us, they presumably think that
once we get to about £6,000 or £7,000 we are going to
be making damn sure it goes to £15,000. I do not think people
will in fact, but that must be the logic. What sort of lottery
funding is this? Why should care work be paid on an "Oh my
God, we might get paid, we might not get paid. Well, I made a
loss this year, lucky somebody at the next desk made a lot of
money because they had a few very simple cases". I tell you
it is rank nonsense and, in fact, Carter never suggested it. The
word "betrayal" has been used. Carter never suggested
it and even Lord Falconer could see the difficulties.
Q213 Julie Morgan: Perhaps I could
ask Roy, who hails from the same place as me, Cardiff, what is
the impact that has been on your firm, which is much larger?
Roy Morgan: We are a very sizable
social welfare practice, as you know. The initial benefit to us
was certainly improved cash flow, there is no doubt, and we were
able to reap some benefit from economies of scale, but, surprisingly,
we are penalised for efficiency. Perhaps I can give an example
to demonstrate what I mean by that, just a day-to-day case. We
have an office in Swansea and we have an office in Cardiff. They
both provide social welfare law in the subjects of housing, welfare
benefits and debt, family law, consumer law and miscellaneous
matters. If I can deal with welfare benefits as an example: our
fixed fee is £268 per case in Swansea, our average case cost
in one month last year—and I have just extrapolated a month—was
£182. We are performing at £85 less than the fixed fee
for welfare benefits. In our Cardiff office, our average[2]
fixed fee is £136 and our average case cost is £290.
We are losing £83 for every new case we take on, but the
books balance because across the practice the two match out virtually
precisely. However, what we received last week—and this
is the fourth time we have had this from the LSC and it shows
some of the problems we have had to deal with—was a letter
saying that our actual costs in welfare benefits in that particular
office were more than 20% lower than the Tailored Fixed Fee. As
a result of that, they are going to reduce our Tailored Fix Fee
in the Swansea office. They have calculated our actual average
cost, adding 2.5% in accordance with the contract, and, as an
acknowledgement that the reduction in costs is likely to be due
to efficiency, they will add 10% on, so our current Tailored Fixed
Fee will be dropped from £268 to £227. That is a 15%
reduction because of our efficiency in the Swansea office and
that may be due to a whole host of factors, but there is no subsequent
increase in the other office. Subject to the contract, they can
always reduce the Tailored Fixed Fee, they can never increase
it, and that is a risk we run. When we then transpose that to
the new suggested rates, we will lose, dealing with welfare benefits
alone, a further 16% and in housing we will lose 39%.
Q214 Chairman: Give me that figure again,
please.
Roy Morgan: Certainly, I got it
the wrong way round. In housing, we will lose a further 16% and
in welfare benefits we will lose a further 39%. It is not viable.
Q215 Julie Morgan: You deal with
other firms and the not-for-profit sector through being the providers
of the Wales Specialist Support Service, how do you feel this
will affect them?
Roy Morgan: The same way, without
a doubt. We are probably, I would like to think, very efficient.
As a result of that, our average fees/costs are lower and our
Tailored Fixed Fees are low.They were probably higher in the past,
therefore the losses will be even greater.
Q216 Julie Morgan: Do you think your
firm is the type of firm that could be used as a model for Lord
Carter's proposals?
Roy Morgan: It has been said slightly
tongue in cheek we could probably be the CLAN for Wales already.
Q217 Chairman: We are not operating
a fixed fee system, or indeed any fee at all, but we do have some
constraints of time. There are a number of quite important points
that I still want to deal with.
Richard Charlton: On the mental
health side, I am anxious to comment about fixed fees and mental
health.
Q218 Chairman: It was going to arise
later but by all means make it.
Richard Charlton: In terms of
fixed fees and mental health, only 22% of mental health providers
decide to take on the Tailored Fixed Fee and that became optional
and that is the current situation. There was a range of reasons
for that, partly to do with administrative efficiency, inefficiency
in the mental health review tribunal office, expansion of case
law, expansion of work to do with mental health review tribunals
particularly, and the previous years being bad models. What really
concerns us and concerns those who signed up to Tailored Fixed
Fees in the past as well as those who have not is that the current
proposals for mental health representation do represent a meltdown.
There is just no way we can continue representation given the
Commission's proposal at the moment and, as I have said in the
documents here, that is not industrial action, that is just simply
we will be unable to do it. What is very disappointing is after
a whole series of meetings with the Commission they seem just
not to understand the kind of work we do. The problem is particularly
highlighted over not being paid if you represented a client before
in the same period of illness, so if I represented, say, Dr Whitehead
three years ago I am allowed to be paid to represent you again,
Dr Whitehead, but I am not paid for any preparation of the case
at all. Your condition may well have changed entirely or your
diagnosis may have changed or the medication you are on, maybe
a whole series of things that I should be professionally required
to look at, your medical records, new reports that we made about
you, say, and new medication, you may have even developed in relation
to your condition.
Q219 Dr Whitehead: I have to say,
it is uncanny how you know so much about me!
Richard Charlton: We will talk
later about that! The fact is that I will not be paid for any
of that work. That is critical work to preparing the case, and,
of course, if I do not do that work for you, I will be negligent
and my insurers will want to become involved and you would say,
"Well, look, how can you do the work for me if you are not
being paid to prepare my case? I was with you three years ago,
but things really have moved on for me and I am allowed community
leave" and so on. It presents our members with a completely
impossible situation and there are other details of the scheme
which are unworkable as well, but it means that we cannot do the
job as set down in the Commission's proposals. They have talked
to us about tweaking it around the edges, there is no tweaking
possible there, that is just a core issue and the vast majority
of us will have to walk away from that current situation. I apologise
for highlighting Dr Whitehead.
Chairman: I think we get the point. Confident
as I am in Dr Whitehead's mental health, I will therefore ask
him to continue.
2 Note by witness: our tailored fixed fee is
£136 and our average case cost is £219. Back
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