The Parliamentary Under-Secretary of State for Justice (Bridget Prentice): I beg to move,

It is a pleasure to serve under your robust chairmanship, Mr. Olner. The order is presented under section 55 of and schedule 9 to the Courts and Legal Services Act 1990, and will enable the Institute of Chartered Accountants of Scotland and the Council for Licensed Conveyancers to become approved bodies, which can authorise their members to provide probate services for a fee, gain or reward. By probate services, I mean the preparation of any papers on which to found or oppose a grant of probate or of letters of administration.

Section 23 of the Solicitors Act 1974 restricts the provision of such services to specified legal practitioners: solicitors, barristers and notaries. Under section 55 of the 1990 Act, however, there is an exemption for members of an approved body. ICAS and the CLC are the first applicants to seek to provide probate services under that Act since the provision was commenced in December 2004.

The applications have passed through the statutory approval procedure set out in schedule 9, and in doing so have been considered and approved by the legal services consultative panel and by the president of the family division. They therefore have my full support.

Under the terms of the application, probate practising rights will be granted only to those members who hold practising certificates in accountancy and wish to provide probate services in England and Wales only. Before members of ICAS are granted practising rights, they will need to show that they can satisfy the requirements set out in section 55. Those include being suitably trained and ensuring that their employees are suitably trained, including meeting the continuing professional development requirement set out by ICAS; having satisfactory insurance and compensation arrangements in place adequately to cover the risk of any claim made against them, and to protect the client in the event of them no longer providing probate services; and having a complaints scheme in place, including a route of appeal to the legal services ombudsman. Members of the CLC will need to demonstrate that they have similar arrangements in place before being granted probate rights.

To meet the full requirements set out in section 55, the CLC requested approval to extend its compensation fund to cover probate matters. An order to that effect came into force on 20 March, and will ensure that clients of licensed conveyancers will be protected against fraud, negligence or dishonesty on the part of the licensed conveyancer.

Consumer protection, which is dear to my heart, is something that ICAS and the CLC have demonstrated in their applications that they take seriously. As established professional bodies in their fields of expertise, they already have in place effective monitoring and enforcement systems. They have ensured that they and their members have, or will have, suitable arrangements in place for the provision of probate services. The potential benefits to the consumer will be greater choice of providers, more competitive prices and, in the case of organisations such as ICAS, which has an existing customer base, the opportunity to provide a more cost-effective and efficient service. That is exactly what section 55 was intended to do, and it is in keeping with our policy of providing new or better ways to provide legal services and a wider choice of people who offer them at competitive prices.

If consumers are unhappy about how either ICAS or the CLC deals with a complaint, they can refer the case to the legal services ombudsman. The ombudsman’s jurisdiction was extended to cover those bodies authorised under section 55 shortly before the provisions were commenced. The ombudsman has been approached by ICAS and the CLC, and has agreed to accept complaints from both bodies relating to the appropriate services provided by their members.

I assure the Committee that it is not anticipated that the legal services ombudsman will receive a high number of additional complaints if the order is approved. In the longer term, complaints about ICAS and the CLC will become matters to be dealt with by the new Office for Legal Complaints, in line with complaints about members of other legal bodies.

If the order is approved, a subsequent order will need to be made amending the Legal Services Act 2007 to bring both bodies under the jurisdiction of the Legal Services Board and ensure that they can retain their probate rights under the future regulatory regime. On that basis, I commend the order to the Committee.

Mr. David Burrowes (Enfield, Southgate) (Con): It is a pleasure to speak under your chairmanship, Mr. Olner, in a debate on an order in which I have an interest. My interest is as a practising—albeit on few occasions—solicitor, but I have to confess that an interest in probate services was not necessarily one that I had while practising, although I did struggle to gain one during my brief apprenticeship in the probate services during articles. Nevertheless, this is a key area for solicitors and an area of interest, as it is estimated that some 10 per cent. of gross fee income for small-firm practitioners comes from it. However, there is no need for that interest to be exaggerated and I understand that the Law Society, which perhaps has a particular interest in the competition that will arise, supports the order.

It is important that we look carefully at the order and take account of the time it has taken to get to this point. I would not suggest that there is necessarily a frisson of excitement across the Committee about the fact that we have reached the point where section 55 of the 1990 Act, which commenced, with particular reference to schedule 9, on 7 December 2004, now enables us, after those long and winding years, to consider these first two organisations.

The Chairman: It has been on everyone’s lips.

Mr. Burrowes: Absolutely, Mr. Olner, and here we are. It is good that we are at this stage, but I ask the Minister to give us an insight into why it has taken so long to reach it and, indeed, why those two organisations alone have applied for authorisation as approved bodies to allow their members to provide probate services.

Without wanting excitement to get the better of us, we must be realistic about the fact that the competition that will come from and be given approval by the order relates to probate services, which effectively means the drawing up of papers in preparation for the founding or opposing of a grant of probate or a grant of letters of administration of the estate in respect of a deceased person. As the Committee will know, the administration of an estate and the lucrative benefits arising from administering an estate are indeed unregulated and not subject to the restrictions in the order.

It is important that we take account of the comments that arose during the consultation in 2001, including those from the Office of Fair Trading, which was looking at the interests of competition. The concerns raised there were about the existing circumstances in relation to the current practice, which was in many ways restricted. That restriction was to the extent that solicitors were often subject to fee guidance from the Law Society, which was and indeed is voluntary, but there was also concern that that was artificially affecting the market.

It would be interesting to hear from the Minister on whether there are concerns in relation to that fee guidance and whether it in any way inhibits price competition for probate services, although there is a general concern about non-contentious services.

The concern that the order seeks to meet is that competition is not strong—perhaps that is indicated by the fact that just two organisations have come forward over the years. The surveys undertaken around the 2001 consultation were concerned about the variety of charging methods and the fact that some solicitors were reluctant to unbundle services and provide just the application for probate to the drawing up of papers, preferring to present it all as one package, which perhaps was not in the best interests of consumers.

Another concern raised in the consultation, which I hope the order will help to meet, was that banks also tended to levy extra charges and set minimum fees. A number of banks would insist—I understand that it is the current practice—on being appointed executor as a condition of administering the estate. The order will, I hope, help to pave the way for greater competition, which we welcome.

Another concern is the do-it-yourself administration of estates: I understand that some 30 per cent. of people make personal applications for the grant of probate, which in some ways appears to be at odds with the growing tendency to use legal services in a variety of non-contentious fields. Perhaps the opportunity to use these two organisations will lead to a change of balance regarding personal applications, especially as they often involve particular complexity and large estates.

I want to draw attention to the fact that when things go wrong in the administration of estates, in many ways it is too late. The area where things often go wrong is wills. There may be inappropriate drafting, particularly when wills are DIY or are ones in relation to which poor advice has been given.

I draw the Minister’s attention to debates in relation to the 2007 Act, which we toiled long and hard to bring to the statute book. In some ways, it is depressing to be considering an order that relates to the 1990 Act, which was introduced many years ago. We are implementing parts of that Act only now.

Putting that aside, one of the debates that the Minister will be aware of related to will writing. The hon. Member for Wirral, West and I were members of the Joint Committee and he will remember acutely the debates that we had, as well as the specific recommendations to omit will drafting from the list of reserved legal activities and that will writing for fee, gain or reward should be included within the new regulatory framework.

Amendments were tabled to that effect, but they did not gain the Government’s approval. Nevertheless, Baroness Ashton said in the other place on 22 January 2007 that while those matters were not controlled and should be included only if there were evidence of need for regulation, which had not so far been proved, they could be added if evidence showed that to be necessary. Will the Minister say whether any evidence has since come to light that puts it on the cards that will writing needs to be regulated? That is directly relevant when one gets to the stage of administering an estate that is based on a poor will. May I make a suggestion? When the order is reviewed in three years’ time, part of the review might take account of evidence gleaned on will drafting and whether there is a need to control it in a manner in which it is not controlled at present. Having said all that, I support the order, which is in the interests of competition.

Tim Farron (Westmorland and Lonsdale) (LD): It is a pleasure to serve under your chairmanship, Mr. Olner. I will be pleasantly brief, I hope. [Hon. Members: “Hear, hear!”] Thank you.

We have no objection to the order. The hon. Member for Enfield, Southgate is a solicitor; I am not. My job is to speak for a sufficiently brief period so as not to make that absolutely apparent.

It is clearly important that provision of probate services should be restricted to people who are properly able and qualified to provide such services—people in whom the public can have confidence and trust. It is right that it has taken some time to get to this stage, although the provision of probate services should not be so restricted to the legal profession that there is not the choice and competition that we have been speaking about. After all, it is the client’s interests we should be concerned about—I am sure we all are—not the interests of any particular professional or other body.

Having said that I have no objections, I would like to ask the Minster some quick questions. Will she keep us up to date as to whether other bodies or institutes are likely to apply, although she need not give names? This is the first order of its kind, so will there be more coming? What volume might we expect in terms of other institutes and potential approved bodies that want to provide probate services? Will she say more about what criteria she will apply to say yes or no to an application from those other institutes or organisations to become an approved body?

This seems an entirely appropriate order. It is right that we widen competition, that bodies be approved to provide probate services after proper scrutiny and that anyone offering such services at a very sensitive time are properly qualified, trustworthy and have the right credentials. We are here, after all, to protect the public, not to be protectionist on behalf of any profession, so I in no way object to the order.

Bridget Prentice: I shall be brief and if I miss anything—I always put in this caveat at the beginning—I shall write to members of the Committee.

If I may, I shall begin with the hon. Member for Westmorland and Lonsdale. I appreciate his support for the order on the basis that it is right to have taken time in order to protect the consumer. That is essential in ensuring that we get this right. Things have taken this length of time because applications did not come in until 2006 and the statutory procedure set out in schedule 9 then had to be followed. That includes the fact that the Secretary of State needs to get the advice of the legal services consultative panel and the president of the family division.

As these were the first applications, it was important that both organisations could demonstrate clearly that they had the necessary arrangements in place to ensure that their members were fit to provide those services to the public. They were subject to particular scrutiny, which is partly why things have taken so long.

The legal services consultative panel met both organisations, discussed the issues with them and sought further clarification from them on the arrangements they had in place to ensure that the consumer was protected. Secondary legislation was also needed so that the CLC could have the proper compensation arrangements in place. That, again, was a result of the recommendation from the consultative panel and the president of the family division.

I agree that sometimes these things seem to take far longer than we would like, but this was the first time that such a thing had happened and the consultative panel was keen for there to be proper scrutiny. The Secretary of State very much accepted that.

On will writing, the position remains as it was when my noble Friend Baroness Ashton said that there was no evidence to suggest that we needed to regulate, although if such evidence comes to light—one of the problems with will writing is the fact that sometimes mistakes do not come to light for a long time—that would be something that the Legal Services Board, for example, could take into account and decide to look at.

I accept the point made by the hon. Member for Enfield, Southgate about the review of this part of the legislation and whether, in three years’ time, it might be appropriate for those matters to be looked at.

The hon. Member for Westmorland and Lonsdale asked about the procedure for authorisation. First, organisations have to apply to the Secretary of State. Then they must demonstrate that they have suitable arrangements for training and for ensuring that their members comply with the requirements of section 55, including arrangements for protecting clients such as a complaints handling scheme, insurance and compensation cover. Then the Secretary of State must seek the advice of the legal services consultative panel and the president of the family division.

Having received that, including any representations from the organisations themselves, the Secretary of State decides whether to approve the application, which becomes effective only if approved by both Houses. The process is therefore, if not cumbersome, quite detailed so as to ensure that applicant organisations properly meet the requirements.

The hon. Gentleman also asked whether any other organisations had applied. Two others are in the pipeline: the Institute of Chartered Accountants in England and Wales and the Association of Chartered Certified Accountants. I suppose that they will look to see how well the process works with the two organisations we are discussing today, and others might then apply. They will all be subject to this same scrutiny. On that basis, I hope that the Committee will approve the order.