Conclusions and recommendations
The financial context
1. The
Government's dramatic proposed reform of legal aid is consequent
upon the need to make drastic reductions in public expenditure
— the Ministry of Justice must cut its spending by almost
a quarter, and reductions in legal aid costs will form an important
part of that. In that context we accept the necessity of certain
changes, and the fact that there are other grounds for making
some of them, but we make specific recommendations about how we
think the Government's proposals should be refined. (Paragraph
11)
Factors contributing to high costs
2. We
are disappointed in the dearth of evidence on legal aid expenditure
at case level to enable the identification of key influences on
cost. We note the difficulties in collating quantitative evidence
for useful national and international observations to be made,
and we believe that a series of small-scale domestic qualitative
research studies, examining the drivers of cost per case, would
provide the Government with more valuable data to inform its efforts
to reduce spending. It may be possible to reduce the amount of
legal work required, for example, by reducing the complexity of
particular areas of law, and thereafter to adjust the level of
fixed fees accordingly. (Paragraph 30)
Lessons from international research for efforts
to reduce costs
3.
The Ministry of Justice needs to develop a greater understanding
about what is driving demand and the cost of cases in order for
there to be confidence in its estimates of the impact of its proposals
for reform. Reducing spending on legal aid may have financial
implications — and indeed may inflate costs — in other
parts of the legal system. (Paragraph 37)
4. The research,
however exploratory, suggests to us that having critically scrutinised
the way our legal procedures have evolved there is potential for
the Government to devise longer-term options for reform, rather
than concentrating on simple options, such as reducing scope.
(Paragraph 38)
5. International comparisons
are difficult, because of the many variables between different
systems, and there are significant gaps in the research. However,
it remains the case that the legal aid system in England and Wales
is one of the most expensive in the world and, in the context
of the budget savings the Government needs to find, this strengthens
the case for examining legal aid costs to see where they can be
reduced. (Paragraph 39)
Reducing costs: Measures in the consultation paper
6. By
far the largest area of savings in the Government's proposed reforms
is the removal from scope of various categories of law, and it
is on this area that much of our evidence has focused and on which
we concentrate in this Report. However, a further important saving
— £72 million annually — would be realised from
the Government's proposed 10% reduction in fees for civil and
family legal aid. We do not underestimate the difficult situation
faced by many legal aid providers. In some cases they have been
subject to a fees standstill for ten years. The ability of smaller
firms, particularly in rural areas, to provide services has been
significantly reduced by tests and procedures implemented by the
Legal Services Commission. We are aware that the other proposed
changes, such as those to scope, will exacerbate those difficulties.
However, given the extent of savings which the Ministry of Justice
is having to make, we think in principle that it is correct that
fees are reduced rather than, for example, further changes made
to scope. We expect the Department to monitor closely the impact
this change, combined with others, has on the supply of legal
aid providers. It should be prepared to respond quickly —
and potentially explore whether the pool of providers can be expanded,
particularly by allowing smaller firms to provide services —
if supply threatens to diminish to a critical level. We shall
scrutinise the performance of the Department in this respect throughout
the remainder of this Parliament. (Paragraph 46)
7. We also welcome
the steps the Government is taking to reduce bureaucracy and costs
in the administration of legal aid but we are concerned that such
steps are carried out in such a way as to ensure that real administrative
savings are made. (Paragraph 47)
Other means of reducing costs: criminal cases
8. While
we welcome the Government's recognition that reductions in scope
cannot readily be made in the field of criminal legal aid, we
were struck by the evidence of the Director of Public Prosecutions
that cost savings could be achieved by greater efficiency in the
courts, which in turn depends on all the agencies concerned working
together more effectively. We expect the Ministry of Justice
to take a lead in pushing this work forward. (Paragraph 49)
Judicial Review
9. While
we support the Government's retention within scope of judicial
review and asylum matters, we were interested in Sir Anthony May's
suggestion that consideration be given to removing automatic legal
aid for those judicial review applications which are, in effect,
seeking reconsideration of previously dismissed appeals, an example
being emergency applications within the Administrative Court in
asylum cases. We recommend that the Government assesses the potential
cost savings which might be made from this change and consult
on its merits. The Government should also consult on whether
the principle could be applied to other areas of judicial review.
(Paragraph 52)
Reducing the number of cases prompted by poor
decision-making
10. We
welcome the steps being taken by the Department for Work and Pensions
to increase the quality of decision-making, and the work undertaken
by that Department and the Tribunals Service to ensure that cases
which do not need to be dealt with at tribunal are resolved earlier.
We note that funds are transferred from the DWP as recompense
for the expense caused to tribunals as a result of policy changes.
However, we think there is potential for such a "polluter
pays" principle to be extended considerably, with the DWP
(and other public authorities whose decisions impact upon the
courts and tribunals) required to pay a surcharge in relation
to the number of cases in which their decision-making is shown
to have been at fault. We think that in rejecting this idea as
a "robbing Peter to pay Paul" transfer of funds around
the public purse, the Minister is overlooking the potential benefit
such a policy would have in providing a financial incentive to
public authorities to get their decisions right first time. We
accept that there would be bureaucratic hurdles to be jumped over
in creating such a system, but we think the potential benefits
merit further consideration and that, in the long-term, cost-savings
could accrue from such a policy. (Paragraph 60)
Other cost savings
11. While
we have not had time to assess these measures in detail, we recommend
that the Government assesses the merits of the cost-saving proposals
put forward by the Law Society. While we understand the need
for short-term savings and support many of those set out in the
consultation paper, we hope that the Government will now turn
its mind to addressing some of the long-term cost drivers of legal
aid, not least with a view to reducing the extent of some of the
limitations to scope proposed in the consultation paper, the impacts
of which we consider below. (Paragraph 63)
Impact of scope changes on vulnerable clients
12. According
to the Government's own figures, the changes it is proposing to
the scope of legal aid will result in 500,000 fewer instances
of legal help and 45,000 fewer instances of legal representation
being funded by legal aid annually. The Government has conceded
that it does not know the extent to which these reductions would
impact upon people with disabilities and black and minority ethnic
people because of information gaps. While it is taking some steps
to address those gaps, evidence we have received, and the Government's
own thinking, suggest that these people, as well as other vulnerable
groups, rely more on legal aid services than do the less vulnerable,
and so there is the potential for them to be disproportionately
hit by the changes. If this were to happen it would sit uneasily
with the Government's commitment to protect the most vulnerable
in society. (Paragraph 69)
Scope: private law children and family cases
13. The
Government is right to retain legal aid in scope in cases where
actions by a public authority "affect the integrity of the
family unit". We accept there is a philosophical difference
between the state intervening to remove a child from a family
and an absence of contact between a parent and child as a result
of relationship breakdown, and that the case for the taxpayer
to fund legal costs is significantly stronger in the former than
in the latter case. (Paragraph 79)
14. We note concerns
put to us that many of the parents involved in difficult cases
involving children will face problems in accessing a court and
representing themselves and that this could impact adversely on
the wellbeing of the children concerned. We note further the
argument put to us by the Family Law Bar Association that, while
the consultation paper appears geared towards meeting the interests
of the party seeking legal aid, it does not meet the interests
of children involved in proceedings. We call on the Government
to address these issues specifically in its response to the consultation.
(Paragraph 80)
Domestic violence as a criterion
15. Given
that family law is the single most expensive area of legal aid
provided through the community legal service we understand why
the Government is seeking to reduce spending on it. However,
we are concerned that using the presence of domestic violence
as a proxy for the most important cases will lead to a perverse
incentive to make false allegations of such violence or, where
such violence has occurred, cause it to feature in disputes before
the courts where it might otherwise not have done so. As well
as potentially harming children in such circumstances, this could
add unnecessary expense, including the cost of legal aid for persons
accused of domestic violence. Additionally, there is the converse
problem of victims of domestic abuse who do not want such abuse
to be brought to court and who will therefore be ineligible for
legal aid. We therefore call on the Government to reconsider
its use of domestic violence as a gateway to legal aid funding
and to bring forward alternative proposals by which to focus family
law legal aid expenditure on the most deserving cases. (Paragraph
87)
16. If the Government
does insist on retaining domestic violence as a criterion for
legal aid eligibility it should adopt a definition of domestic
abuse which explicitly incorporates non-physical abuse and we
welcome the Minister's statement that he will consider this matter
further in light of the consultation responses. Further to broadening
the definition of domestic abuse, the Government should ensure
that undertakings as to future conduct rather than orders of the
court are sufficient to confer eligibility. (Paragraph 88)
Mediation
17. The
Government's commitment to the provision of mediation in private
law cases is very welcome and its aspiration to use mediation
to divert as many cases as possible from the courts is prudent
and generally in the best interest of both parties and any children
involved. However, we agree with the President of the Family
Division that mediation cannot be a panacea and that it will not
work in all cases. Further work needs to be done on how difficult
and unresolved cases can be dealt with if legal aid is not available.
(Paragraph 98)
Rule 9.5 cases
18. We
share concerns raised with us that parents in rule 9.5 cases will
not be eligible for legal aid, and that courts will have unrepresented
litigants in cases which involve significant difficulty. We urge
the Government to consider amending its proposals to permit legal
aid provision in any rule 9.5 case where it is clearly necessary.
(Paragraph 101)
Timing of the proposals
19. The
Family Justice Review Panel is undertaking a fundamental reassessment
of the family law system and its recommendations are likely to
have a significant impact upon that system. The Government should
wait until the Review Panel has produced its full report before
implementing changes to the legal aid system in the area of family
law. (Paragraph 105)
Help and advice from other sources
20. We
welcome the Government's provision of funding for face-to-face
debt advice for a further year and the £100 million Transition
Fund, designed to help not-for-profit organisations change to
a business model which leaves them less reliant on public funds.
However, long-term concerns remain: how will sufficient debt
advice be provided once the deferred ending of the face-to-face
service happens? How many organisations will be able successfully
to adapt their income streams in the manner encouraged by the
Transition Fund? What will happen to those who cannot and the
clients who use their services? The answers to these questions
are not known and the Government should be prepared to extend
further the provision of face-to-face debt advice and offer a
second round of Transition Fund grants if necessary. (Paragraph
123)
21. We note that the
Government recognises the difficulties faced by the not-for-profit
advice sector. It is unsatisfactory that, on the Government's
own admission, the Cabinet Office has been brought in at a late
stage. We welcome the work it is doing to assess the situation
and to find ways of helping the voluntary and not-for-profit sectors,
but we are concerned that leadership and co-ordination across
departments has not covered all relevant areas. Representatives
of organisations in this field have made it clear they do not
believe it will be possible for their organisations to meet all
the unmet demand which will be created by the proposed changes
to legal aid. That assertion casts doubt on a key condition for
the Government's proposed reforms - that clients will be able
to access non-legal aid-funded sources of advice. (Paragraph 128)
Self-representation at tribunals without assistance
22. While
the nature of tribunals generally means that legal representation
is not necessary, we are concerned that the removal of legal aid
for legal help could cause more cases without a realistic chance
of success to reach tribunals (thus increasing the tribunals'
costs). We are also concerned that the ability of the most vulnerable
people to present their cases will be weakened because they will
not have had help and advice in preparing them. This could deny
justice to the individuals concerned and increase the time and
expense necessary to deal with the case at tribunal. The increasing
complexity of procedure in some tribunals has made it difficult
for vulnerable people to represent themselves. We urge the Government
to initiate consultations in order to develop proposals to make
tribunals more user-friendly and less legalistic. (Paragraph 132)
Costs to the public purse of removing legal aid
23. It
has been put to us that the removal from scope of many areas of
social welfare law will lead to significant costs to the public
purse as a result of increased burdens on, for example, health
and housing services. We are surprised that the Government is
proposing to make such changes without assessing their likely
impact on spending from the public purse and we call on them to
do so before taking a final decision on implementation. (Paragraph
136)
Impact of scope changes: immigration
24. As
with the social welfare scope changes, the Government's contention
that immigration law (other than detention cases) should be removed
from scope because the issues concerned are of relatively lesser
importance and that the user-friendly nature of tribunals mean
that individuals should be able to navigate their way through
them without publicly funded assistance has been strongly criticised.
Again, as with the other scope changes, it seems likely that
there will be consequential costs for budgets other than legal
aid, and we recommend that the Government assesses these fully
before deciding whether to proceed with its proposals. (Paragraph
143)
25. ILPA raised two
questions about the Government's proposals, namely: whether immigration
cases involving domestic violence will remain within scope; and
whether claims based on Article 3 of the European Convention on
Human Rights (prohibition on torture and inhuman or degrading
treatment or punishment) will remain within scope. We would appreciate
clarification of the Government's position on these areas. (Paragraph
144)
Impact of scope changes: education
26. We
do not believe that it is generally in the interest of children
with special needs that public funds should have to be devoted
to funding legal representation in disputes about their needs.
This inevitably diverts local authority funding into paying for
lawyers, experts and court proceedings when those funds could
be better spent on providing the facilities which special needs
children require. We believe that, in the context of its consultation
on special educational needs, the Government should aim to reduce
dramatically the requirement for legal proceedings in this area.
(Paragraph 150)
Overall impact of scope changes
27. The
scale of savings sought by the Government requires changes to
be made to the scope of legal aid. However, we have outlined
some concerns about the impact of some elements of those scope
changes and hope the Government will address those concerns.
The effect of doing so might be to reduce the level of savings
realised; however, we have set out above some proposals for savings
not covered in the consultation paper which, if implemented, could
help offset any shortfall in savings accruing from the refinement
of the scope proposals we are advocating. (Paragraph 151)
Legal aid as a national public service
28. We
note the fears expressed by some providers that the Government's
proposals could result in the end of legal aid as a national public
service. We are not convinced that this will necessarily be the
case but we think that, for several reasons, there could be significant
under-supply of providers in some areas of the country, or indeed
some 'advice deserts'. We note the Minister's assertion that
the savings to be made of £350 million have to be seen in
the context of an overall budget of £2.2 billion. The Government's
own impact assessment notes that there is "much uncertainty"
about the impact on providers and we urge the Government to conduct
a more thorough assessment of the likely effect on geographical
provision of each category of civil and family law before deciding
whether to implement the proposals. (Paragraph 156)
Competitive tendering
29. The
Government has begun a separate consultation on the introduction
of a competitive tendering model for legal aid and its potential
to encourage efficiencies and innovation. We note the reference
to this work by the Minister in answer to a question about possible
advice deserts and believe that any competitive tendering model
adopted should have as a key objective the avoidance of such deserts.
We look forward to the outcome of the consultation exercise.
(Paragraph 159)
Telephone helpline
30. We
accept there are concerns about the ability of some vulnerable
clients to access services via a telephone helpline. However,
the scale of the savings to be made through the use of such a
helpline (£50 - 70 million annually) and the fact that some
clients might benefit from such a service, means that this is
an option worth pursuing. We encourage the Government to do so,
but would also urge it to work with both public and private providers
of services to make sure the helpline is designed in a way which
makes it effective for vulnerable clients. We urge the Government
to monitor closely the effectiveness of the helpline, particularly
for vulnerable clients. (Paragraph 163)
Conclusions
31. The
full cost implications of the Government's proposals cannot be
predicted with a great deal of accuracy given the difficulties
in knowing what impact behavioural change will have on the number
of cases brought to the courts and the incidence of litigants
in person. (Paragraph 171)
32. There is insufficient
information about the impact of litigants in person on court processes,
although we welcome the literature review and related work being
undertaken by the Department in order to gain a better understanding
of this issue. In any event, it seems probable that the Government's
proposals, if implemented, are likely to lead to an increase in
the number of litigants in person. We urge the Government to
build on the findings of its ongoing research by establishing
an expert group, involving members of the judiciary, lawyers and
others, to review what can be done to make more effective the
manner in which the courts and tribunals handle litigants in person,
with a view both to making recommendations aimed at containing
costs and ensuring that justice is done (Paragraph 172)
33. We have identified
a number of areas where more radical change, going beyond the
savings required in the short-term, should be explored. These
will require the building up of a better evidence base. (Paragraph
173)
34. The Government's
proposals to reduce the cost of legal aid are a response to the
budgetary situation and to the high level of expenditure on legal
aid in this country by comparison with others. The proposals
present a severe challenge to many of those involved with the
justice system, because they assume that less use will be made
of legal proceedings, that voluntary and not-for-profit organisations
in difficult financial circumstances will be able to find new
ways of funding legal advice, and that courts and tribunals will
make it easier for litigants to appear before them without legal
assistance. In our view it will also be necessary for public
bodies to improve their decision-making so as to generate fewer
appeals to the courts and tribunals, an approach which needs to
be encouraged by shifting financial responsibility for some of
the costs to the bodies whose decisions incur them. Ministers
need also to look at other proposals to reduce the cost of legal
aid, such as stricter merit tests applied by the courts with regard
to judicial review. The Government's proposals, which need considerable
further refinement, assume a major change in the way the accessibility
of the justice system has come to be viewed, and it is a change
for which many of those involved are unprepared. (Paragraph 174)
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