2 Establishing robust financial procedures
9. The method of agreeing counsel fees that the Revenue
and Customs Prosecutions Office inherited from its predecessor
had been in place for many years, but was fundamentally flawed.
Instead of agreeing the hours to be worked or a fee with counsel
or counsels' clerks at the outset of the case, it was usual practice
for negotiations to begin after the submission of the fee notes.[19]
Larger or more complex prosecutions took months to complete, and
delays by counsel in submitting their fee notes impacted on the
Department's ability to monitor its financial position. The Comptroller
and Auditor General issued a qualified audit opinion on the Department's
2005-06 Resource Accounts because the Department could not provide
sufficient evidence that counsel fee expenditure for 2005-06 of
£15.7 million, and related accruals at 31 March 2006 of £11.8
million, were not materially understated.[20]
10. Late submission of fee notes also made the process
of validating the individual fees claimed less objective than
it should have been. Until September 2006, when the Director implemented
a more robust system, establishing the accuracy of the fee charged
relied on the honesty of counsel putting in the proper hours for
what they had done. It also depended on the knowledge of the individual
prosecuting lawyer within the former Customs and Excise Prosecutions
Office, and the experience of the Department's fees and nominations
team in assessing fee notes and knowing how much work any particular
case would require.[21]
The potential for overcharging was illustrated when the Department
negotiated down a barrister's fee note from £990,000 to £550,000.
The fee related to work carried out up to three years beforehand.[22]
11. Under the Department's new system, most cases
involve fixed fee payments to counsel, negotiated at the start
of the case. For large or complex fraud, or large-scale drug importation
cases, the Department agrees the fees and the amount of work required
at a case conference between the prosecuting lawyer and counsel.
Counsel are paid at a standard rate of £185 an hour and bills
are submitted monthly for payment. Counsel and the lawyer meet
monthly to discuss progress and the need for additional work.
This has made fee note validation easier and has reduced the opportunity
for error or fraud. The Director estimated that around 85% of
counsel complied with the new arrangements.[23]
Overall, the Director considered the Department was now exercising
tighter control over fees paid to counsel.[24]
12. The Department has yet to develop a range of
effective sanctions to help increase the proportion of accurate
fee notes submitted on time. Currently, those who have not submitted
fee notes on time are made aware of the Director's displeasure.
The Director considered that persistent failure by counsel to
comply might result in them not being instructed for other cases.[25]
13. The Department's
analysis of fees paid to barristers in chambers over the five
year period from 2003-04 to 2007-08 (Figure 1) indicated
that the Department relied on a few, specialist suppliers. One
set of chambers earned more than £11 million, three sets
earned between £5 million and £7 million, and 13 sets
earned more than £1 million. The Director maintained that
there were very few barristers at the criminal bar capable of
prosecuting a major fraud and that this expertise was concentrated
in a few specialist chambers. The Director, for example, joined
the Department from the highest earning set of chambers (18 Red
Lion Court). Five of his former colleagues act as standing counsel
to the Department, reflecting 18 Red Lion Court's status as a
centre of excellence. Of these five counsel, two were appointed
as standing counsel after the Director left the chambers to take
up appointment but he was not involved in their appointment or
in the allocation of briefs to individual barristers.
Figure 1. Payments to barristers in chambers for the period 2003-04 to 2007-08
| RANGE
| NUMBER OF CHAMBERS RECEIVING PAYMENTS IN RANGE
|
| More than £11 million
| 1 |
| £9 million to £11 million,
| 0 |
| £7 million to £9 million
| 0 |
| £5 million to £7 million
| 3 |
| £3 million to £5 million
| 2 |
| £1 million to £3 million
| 11 |
| £0.5 million to £1 million
| 11 |
| £0.1 million to £0.5 million
| 30 |
| £10,000 to £100,000
| 38 |
| £1,000 to £10,000
| 26 |
| Less than £1,000 |
29 |
Source: Ev 17
14. There was no commonality in the way the four
Law Officers' Departments selected, engaged, negotiated with and
paid counsel (Figure 2). Three of the Departments (Revenue
and Customs Prosecutions Office, the Serious Fraud Office and
the Crown Prosecution Service) engaged counsel to assist with
the prosecution of cases, and one (Treasury Solicitor's Department)
engaged junior counsel and barristers to help defend government
bodies in civil and public law cases. All four bodies negotiated
the terms of engagement in advance, including the expected duration
of the work. Methods of negotiating fees varied. Counsel working
with the Serious Fraud Office and the Crown Prosecution Service's
Graduated Fees Scheme negotiated a single fee for the whole case.
All four Law Officers' Departments required counsel to submit
monthly bills. Sanctions for late submission of bills also varied,
with the Treasury Solicitor's Department requesting resubmission
of fee notes that do not comply with its process.[26]
Figure 2. Comparison of the Law Officers' Departments arrangements for engaging, instructing and paying counsel
| | Revenue and Customs Prosecutions Office
| Serious Fraud Office
| Crown Prosecution Service (CPS)
| Treasury Solicitor's Department
|
| | | | Graduated Fees Scheme
| Very High Cost Case scheme
| |
| Work type
| Criminal | Criminal
| Criminal | Criminal
| Civil/Public Law |
| Body's role
| Prosecuting authority |
Prosecuting authority | Prosecuting authority
| Prosecuting authority |
Defending government bodies in litigation
|
| Method of allocating cases to counsel
| Selected in rotation from Attorney General's approved list of counsel
| Maintains list of eligible counsel nominated by chambers. At least three counsel are invited to tender for each case
| Some handled by CPS Higher Court advocates, all others passed to self -employed Bar on a "taxi rank" basis
| Barristers go through a nomination process before being appointed on the basis of skills and experience
| Panel system for appointing junior counsel. Nomination from the Law Officer before appointing Queen's Counsel (QC)
|
| Fee rate(s)
| Standard rates across three case regimes1
| Defined in ranges, according to grade
| Standardised rates agreed between CPS and the Bar Council
| Standardised rates |
Standardised rates for Junior Counsel.
QCs rates are defined in ranges.
|
| Method and timing of fee rate negotiations
| Projected hours are agreed in advance each month for hourly cases
| Price agreed in advance is the price paid
| Tariff of charges. Barrister receives a single fee, payable on completion
| Price dependent on pre-agreed number of hours to be spent on the case
| Juniors are paid a fixed rate. Hourly rates are agreed in advance for QCs
|
| Frequency of fee note submission
| Monthly | SFO contacts chambers to request monthly bills
| Within three months of the main hearing date
| On a staged payment basis, with stages lasting between 8 and 12 weeks
| Monthly |
| Sanctions for late fee note submission
| Counsel are informed that persistent late billing may lead to removal from the Attorney General's list
| No penalties for late billing
| No penalties for late billing
| No penalties for late billing
| Payment may be delayed where fee notes are not in compliance with process. There are no other sanctions for not billing on a timely basis.
|
Note: 1. The Revenue
and Customs Prosecutions Office operates three case regimes: standard
(trial expected to last up to two days); premarked (trial expected
to last three to fifteen days); and hourly (trial expected to
last over fifteen days)
Source: Ev 14
19 Qq 7-11, 56, 64, 66, 99 Back
20
C&AG's Report, para 9 Back
21
Qq 60, 97 Back
22
Qq 59, 63, 69-76, 94, 100 Back
23
Q 89 Back
24
Q 61 Back
25
Qq 61, 89-90, 93 Back
26
Ev 15 Back
|
