Conclusions and recommendations
1. There is a lack of clarity in the respective
roles of the Ministry of Justice and the Legal Services Commission,
leading to uncertainty and duplication.
This relationship is currently subject to an independent review.
Irrespective of the outcome, the Department needs in future to
perform a sponsor role in which its oversight and interventions
are proportionate to the risk of spending and activities in respect
of legal aid. This needs to be reflected, as a matter of urgency,
in the framework document, policy responsibilities, and performance
management regime with which the Department governs the Commission.
2. The Commission has failed to get a grip
of its financial management and weak internal controls led to
its accounts being qualified in 2008-09 because of an estimated
£25 million of overpayments to solicitors.
As a priority, the Commission and the Department should ensure
that effective financial management becomes a priority at the
most senior level, and should put in place measures to respond
more rapidly to emerging financial risks. These measures need
to be in place as it moves to making more payments electronically.
3. The Commission was unable to account for
the significant variation in profits from criminal legal aid work
reported by solicitors. Having been requested
to abandon its proposals for Best Value Tendering, the Commission
should set a timeframe to gather much more coherent information
on the costs and profits of firms providing legal aid so that
it can set prices which reflect good value for money for the taxpayer
while ensuring the sustainability of the service.
4. The Committee is concerned that the increasing
use of solicitors to conduct work in the Crown Court is threatening
the long term future of the junior criminal bar and may be affecting
the quality of advocacy being provided in the Crown Court.
The Commission needs to guarantee the quality of the legal aid
services it purchases. As a matter of urgency it needs to finalise
how it will measure the quality of advocacy in the Crown Court.
It also needs to produce a robust plan for how it will deploy
peer review more strategically for solicitors.
5. Everybody is entitled to free legal aid
if they are held by the police, but only about half of people
take this up. The Commission should develop
a mechanism for collecting the views of legal aid users on the
service provided and properly investigate the reasons why people
do not currently take up legal aid. It should also evaluate the
wider impact of low take-up of legal advice on the criminal justice
system, and the potential financial consequences of improving
access to it.
6. Although the Department and the Commission
launched a separate system for paying for the most expensive Crown
Court cases in 2001, eight years later they still do not know
whether this system gives value for money.
As they seek to make further savings from the legal aid budget,
the Department and Commission should prioritise making savings
in these most expensive cases. By July 2010, they should complete
an evaluation of past cases to determine at what value it is most
efficient to administer cases separately through a contract, and
when it would provide better value for money to handle cases using
existing graduated fee schemes. They should then set the threshold
for using contracts at the value which optimises value for money.
7. While the Committee accepts that specialist
skills need to be properly remunerated we were concerned to find
that some barristers, notably Queens Counsel, can earn up to £1
million a year from publicly funded criminal legal aid cases.
The Commission should consider introducing an earnings cap for
all individual solicitors and barristers.
8. The Commission has struggled to recruit
and retain the right skills on its senior team where the high
turnover of staff has been disruptive and expensive.
The Commission should define the skills it needs, in particular
at a time when it has to make significant administrative savings,
and set out how it will maintain its skills at this level.
9. The Commission lacks a clear strategic
direction, reflected in its poor management of the changes to
legal aid detailed by Lord Carter. The
Department and the Commission need to adopt a more coherent approach
to introducing change. The Department must commit that all future
reforms should have a clear timetable, should be fully piloted
and evaluated, and that these evaluations are timely and consider
the impact of reforms on suppliers, as well as identifying any
financial impacts of the change.
10. The Committee was disappointed, given
the serious nature of the issues discussed at this hearing, that
the Ministry of Justice was not represented by its Accounting
Officer. Our expectation is that Departmental
Accounting Officers will appear in person to account for their
spending before the Committee of Public Accounts, and in future
the Committee will only consider inviting an alternative witness
where a very clear case can be made.
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