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Session 2009 - 10
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Delegated Legislation Committee Debates



The Committee consisted of the following Members:

Chairman: Mr. Martyn Jones
Bellingham, Mr. Henry (North-West Norfolk) (Con)
Borrow, Mr. David S. (South Ribble) (Lab)
Bottomley, Peter (Worthing, West) (Con)
Buck, Ms Karen (Regent's Park and Kensington, North) (Lab)
Cairns, David (Inverclyde) (Lab)
Hall, Mr. Mike (Weaver Vale) (Lab)
Heald, Mr. Oliver (North-East Hertfordshire) (Con)
Holmes, Paul (Chesterfield) (LD)
Howarth, David (Cambridge) (LD)
Jones, Helen (Vice-Chamberlain of Her Majesty's Household)
Kemp, Mr. Fraser (Houghton and Washington, East) (Lab)
MacShane, Mr. Denis (Rotherham) (Lab)
Malins, Mr. Humfrey (Woking) (Con)
Prentice, Bridget (Parliamentary Under-Secretary of State for Justice)
Wright, Mr. Anthony (Great Yarmouth) (Lab)
Wright, Jeremy (Rugby and Kenilworth) (Con)
Glenn McKee, Committee Clerk
† attended the Committee
The following also attended (Standing Order No. 118(2)):
Baldry, Tony (Banbury) (Con)
Vara, Mr. Shailesh (North-West Cambridgeshire) (Con)

Sixth Delegated Legislation Committee

Tuesday 12 January 2010

[Mr. Martyn Jones in the Chair]

Costs in Criminal Cases (General) (Amendment) Regulations 2009
4.30 pm
Mr. Henry Bellingham (North-West Norfolk) (Con): I beg to move,
That the Committee has considered the Costs in Criminal Cases (General) (Amendment) Regulations 2009 (S.I. 2009, No. 2720).
It is a pleasure to serve under your chairmanship, Mr. Jones. I declare an interest as a qualified barrister who practised for a number of years at the criminal Bar.
Why have we prayed against the regulations? We have done so because we believe that they are fundamentally unfair and wrong. They breach a key principle of 20th-century criminal justice—that if a member of the public who is charged with a criminal offence seeks private representation in court and is subsequently acquitted, his or her reasonable costs will be met from central funds. That has always been the case. In most cases, the defendant in question did not qualify for legal aid; the offence was in an area where legal aid did not apply, such as motoring offences; or the individual simply wanted to go to the family solicitor and have private representation in court. In those circumstances, if the defendant was acquitted, reasonable costs would be paid out.
It is worth bearing it in mind that no citizen asks to be prosecuted; that is particularly true of those citizens who know that they are innocent. They have to spend their money, in many cases, to defend themselves—to defend their livelihoods and to secure their careers, their families and even their liberty. Obviously, the stress is horrendous, but all along they knew that if they were acquitted, they would receive their reasonable costs from central funds. Now, they are being told that since these regulations came into force on 31 October 2009—that is worth bearing in mind—they will receive from central funds only the legal aid equivalent rates, which obviously are far lower. As the Government have made clear, they are set at 25 per cent. of average private rates.
What does that mean in practice? It means that if an innocent defendant is acquitted in a magistrates court in a standard case, they will receive roughly £1,000 less than what they have had to pay out. That is the legal aid rate that they will receive, and that is an average case. Of course, there will be many complex cases in which the costs will be far greater. In the average medium-sized case in the Crown court, the loss will be up to £20,000. There is no exact figure, but we are looking at anywhere from £15,000 to £20,000. Again, in the much more complicated cases, the loss to the pocket of the individual will be far greater.
There is absolutely no equality of arms in all this, because the Ministry of Justice has no intention of limiting prosecution costs in the same way. In other words, the Government will prosecute someone who may well be innocent, but the Government will not hold back at all in terms of the prosecution costs.
The Government put this out to consultation.
Mr. Oliver Heald (North-East Hertfordshire) (Con): Does my hon. Friend share my view that this is bad for the prosecution? It is limiting the risk of litigation for them, because at the end of the day, if they lose some half-baked prosecution case, the penalty in costs that they suffer, or that the state suffers, will be tiny in comparison with the real costs.
Mr. Bellingham: That analysis is very true. It might indeed make sense to transfer the costs of defendant’s costs orders from central funds to the prosecutors themselves, because that might well drive better prosecution decision making. I should like to put that idea to the Minister.
In November 2008, the Government issued a consultation paper entitled “The Award of Costs from Central Funds in Criminal Cases” and they asked for people’s views and comments. What is interesting is that there was overwhelming opposition to the Government’s proposals. My goodness, I do love the civil service sometimes; there is a classic piece of understatement in the explanatory notes:
“Overall, respondents to the proposals were in favour of maintaining the current system whereby defendants are entitled to claim their legal costs if they are acquitted. Respondents considered that the existing approach for awarding the costs of privately paying clients, determined on a case by case basis, is both fair and transparent.”
That is a massive understatement, because there was a huge amount of opposition to this, and a great deal of anger was voiced.
Peter Bottomley (Worthing, West) (Con): Most members of the Committee have not had much time to do research, and I congratulate my hon. Friend on having done his. Can he recall any substantial body that said yes to the Government’s proposal? Did the Law Society? Did any other collection of lawyers? There is probably no collection of people who have been prosecuted and found innocent. Who supported the Government’s proposals?
Mr. Bellingham: I am grateful to my hon. Friend for that question, because it is a good one. I do not know anyone who supported it. I see that the officials are scribbling furiously, so maybe the Minister will be able to enlighten us. I understand that there was 100 per cent. opposition to the Government’s option, which is restricting the costs to legal aid rates.
If one wants to look at reasonable costs, one should look at the Prosecution of Offences Act 1985, which was passed when my hon. Friend the Member for Worthing, West was a junior Minister. The Act is sensible because section 16(6) says that:
“such amount as the court considers reasonably sufficient to compensate him”
or her
“for any expenses properly incurred by him”
or her “in the proceedings.”
Mr. Humfrey Malins (Woking) (Con): I confirm what my hon. Friend has said: there always was a safeguard in that the court would order what was reasonably sufficient rather than full indemnity. It is all the more important to keep that safeguard.
Mr. Bellingham: I am grateful to my hon. Friend. He has a huge amount of experience because he sits as a recorder. I hope that Government Members, who may not be that familiar with the regulations but have been drafted on to the Committee, will listen carefully to the views of experts at the sharp end. I have not been in practice for many years, but my hon. Friend sits in judgment on these cases and knows what he is talking about, so he should be listened to.
The regulations flow from the Ministry of Justice’s decision to reintroduce means-testing in magistrates courts and introduce it in Crown courts. Since means-testing was reintroduced in magistrates courts there has been a significant increase in the number of acquitted defendants recovering costs from central funds, but it is a classic case of the MOJ trying to make savings in one area but triggering extra expenditure in another. The costs are being shifted.
Will this save a great deal of money? I do wonder. Page 13 of the MOJ consultation paper, “The Award of Costs from Central Funds in Criminal Cases”, of November 2008, says:
“In 2007/08 acquitted defendant costs accounted for approximately £41 million”,
which is 66 per cent. of total expenditure from central funds. The MOJ claims that the SI will save between £22 million and £25 million a year. I am dubious about those figures, because there will be many more litigants in person. Lots of people will have to defend themselves; they will not plead guilty just because they cannot get legal representation. They will go to court and defend themselves. My hon. Friend the Member for Woking, who sits as a recorder, will know that in many courts the system is overloaded and clogged up. We will have many more litigants in person, who will be fighting to save their careers and livelihood, and those cases will take much more time. A lot of extra pressure will be put on the system.
The Minister will undoubtedly ask, “How are you going to find about £22 million or £25 million?” I would simply say that we have strenuously resisted many initiatives by this Government and this Department. We can put our hands on our hearts and say we would not have done this. We would not have spent £58.9 million on the new Supreme Court, for example. It costs nearly £14 million a year to run, which is £37,500 a day, according to my quick calculation before coming into the Committee. The chief executive is on more than £100,000 to run a court that employs 39 people, when the business of that court used to be carried out down this corridor with a staff of six or seven, costing no more than about £500,000 a year.
What about the Judicial Appointments Commission, which again we resisted strongly? That is costing more than £9 million. As for the modernisation of the MOJ building, I am all for Ministers having incredibly plush quarters, but on the other hand, was the money well spent? Was it justified in these tough times? What about the running costs of the Legal Services Commission? When the Minister asks how we would find the money, we can put our hands on our hearts and say we would not have done that because we would have made savings elsewhere. We would not have made savings in such a way as to put pressure on our constituents who are trying to defend themselves in court.
Mr. Fraser Kemp (Houghton and Washington, East) (Lab): I am slightly confused, because the money has been spent—we have done the refurbishment of the MOJ and we have the Supreme Court. Unless the hon. Gentleman is saying that his Government would abolish the Supreme Court, where is he going to get the extra money? The money has been spent, so where is the saving? Has he got authority from the Shadow Chancellor for an extra £25 million expenditure?
Mr. Bellingham: I am grateful to the hon. Gentleman for intervening in that way. As I explained, we would not have done this and would have made savings elsewhere. When tabling this prayer, we had clearance from our Treasury team for this item of expenditure. That is crystal clear. My colleagues in the MOJ department have made it clear that, if we do win the election, we will look for savings elsewhere, if this does not go through. If it goes through, that is another matter, because we are not in the business of coming into government and overturning everything. We hope that, if Members vote sensibly and in accordance with the wishes of their constituents, this will not go through.
Mr. Malins: On the question of saving money, it would not be necessary to abolish what has been already done—although that might be a good idea, to save £22 million. The truth is that we waste far more than that due to aspects of the Crown Prosecution Service, including the Criminal Justice Unit, with which no doubt the hon. Member for Houghton and Washington, East is familiar. Its inefficiencies in warning witnesses and other matters result in a huge number of criminal cases being dismissed for want of prosecution, at huge expense to the Crown court and magistrates court system.
Mr. Bellingham: Indeed. That is about case management, efficiency and leadership in the Department, and is something that we are going to see to. It links to the suggestion made a moment ago of transferring the cost of defendant’s costs orders from central funds to prosecutors. That would impose on prosecutors a decision-making process that would lead them to concentrate much more on prosecutions that are truly in the public interest. Maybe the Minister could look at that suggestion. Rather than going down the route of these regulations, there is another solution available, which is to put the cost on to the Crown Prosecution Service. That would be a perfectly fair way of ensuring that our constituents are fairly treated, at the same time as making some modest savings.
 
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