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We are confident that, contrary to some of the concerns expressed, ABS will improve access by making legal services more readily available at lower prices. I understand that that view is not shared by all noble Lords, but we have heeded the weight of feeling expressed on all sides and have introduced amendments that provide additional safeguards for access to justice, while placing it firmly in the context of the other regulatory objectives. The amendments that I speak to in this group will achieve this. They replace amendments that risk giving access to justice priority over other regulatory objectives but still give special attention to access to justice. My understanding is that the amendments received widespread support in the other place and I commend them to the House.

Moved, That the House do agree with the Commons in their Amendment No. 19.—(Lord Hunt of Kings Heath.)

Lord Thomas of Gresford rose to move, as an amendment to the Motion that this House do agree with the Commons in their Amendment No. 19, at end insert “but do propose Amendment No. 19A as an amendment to Commons Amendment No. 19”.

The noble Lord said: My Lords, we have spent hours debating the impact of alternative business structures on what I have referred to in the past as the high-street solicitor, about whose interests I am very concerned. The alternative business structures are welcomed by large firms of solicitors, which see them rather like private companies listed on the Stock Exchange; they give to the large solicitor firms and to partners in large practices the opportunity to sell out with large advantage to themselves. Of course, when it comes to the countryside and to rural areas, it may very well be that an alternative business structure from some large organisation—in the past we have talked about supermarkets—could put out of business those firms of solicitors that provide a very significant service to their community and are part and parcel of that community.

Amendment No. 19A, therefore, is designed to clarify Amendment No. 19, which, of course, we welcome, but the government amendment simply requires the rules to have a provision that the licensing authority will take account of the objective of improving access to justice. That is a very broad statement. In Amendment No. 19A, I am trying to focus on the problem that I have outlined. I hope that some significant words of comfort will come from the Minister, which will be designed to make it absolutely clear what the government amendment is aimed at in particular. It may not be necessary for me to trouble your Lordships further. For the moment, I beg to move.

Moved, as an amendment to the Motion that this House do agree with the Commons in their Amendment No. 19, at end insert “but do propose Amendment No. 19A as an amendment to Commons Amendment No. 19”.—(Lord Thomas of Gresford.)



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Lord Hunt of Kings Heath: My Lords, is the noble Lord, Lord Neill of Bladen, speaking to this group?

Lord Neill of Bladen: My Lords, I shall be moving Amendment No. 72A, an amendment to Amendment No. 72, which is later in the Marshalled List, on page 9. It has been grouped with the amendment that the noble Lord, Lord Thomas, has spoken to. That is a rather odd grouping, if I am to be allowed to develop the nature of my amendment. In substance, my amendment is aimed at restoring the position in the Bill when it left this House—namely, that Part 5 of the Bill will not be put into operation until there has been a further inquiry and investigation by a committee with a report to both Houses. I would like to develop that at the appropriate moment.

Lord Hunt of Kings Heath: My Lords, there are two alternatives. As I understand it, the amendments are grouped together and the noble Lord may care to develop his arguments now. Alternatively, he can decide to degroup his amendment and we can consider it later. It is very much a matter for the noble Lord.

Lord Neill of Bladen: My Lords, my preference would be to degroup it because of its incongruity with the scope of the amendment of the noble Lord, Lord Thomas. I would like to consider at a later stage the amendment standing in my name.

Lord Hunt of Kings Heath: My Lords, that is very much in the noble Lord’s hands. We must just ensure that we debate it when we reach it. Speaking for myself, I find that it is quite easy to lose track of what we are doing at this stage of a Bill.

To respond to what I take to be the probing amendment of the noble Lord, Lord Thomas, I agree with everything that he said about access to justice. The noble Lord will know that I have responsibility within the Ministry of Justice for legal aid, which can perhaps be described as a friendly challenge at the moment. Clearly, from my point of view, I am concerned to ensure that there is provision throughout the country. I understand the points that he makes about rural areas. I have no doubt that we will have another opportunity to discuss legal aid, but I want the noble Lord to understand that I sympathise with his points.

There is no question but that an integral element of access to justice is the availability of services, not just in theory but in practice. I reassure the noble Lord, Lord Thomas, that the effect on providers is covered by our access to justice amendment. It does not need separate provision. The effect on existing provision will need to be taken into account, for the sake not just of providers but of their clients and the need for access to justice. I am confident that the vast majority of applications will lead to improvement in these areas, improving access to justice as a result. The amendments that we are making to Clause 83 reinforce this by signalling the importance of access to justice in the alternative business structure context. I hope that that reassures the noble Lord.



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Lord Thomas of Gresford: My Lords, I referred to the service provided by the high-street solicitor to the community. It is the community interest that concerns me most—people who, I recall, look to their local solicitor to provide them with a range of services on the various legal issues that arise in their life. I have those people in mind, but I am reassured by the noble Lord’s words and beg leave to withdraw my amendment.

Amendment, by leave, withdrawn.

On Question, Motion agreed to.

5.45 pm

Lord Hunt of Kings Heath: My Lords, I beg to move that this House do agree with the Commons in their Amendments Nos. 20 to 38.

Moved accordingly, and, on Question, Motion agreed to.

Lord Hunt of Kings Heath: My Lords, I beg to move that this House do agree with the Commons in their Amendments Nos. 39 to 46. This group of amendments relates to the OLC’s power to make rules on charges payable by respondents. I know that this has been the subject of considerable concern. It is known as the “polluter pays”. I understand noble Lords’ concerns about the original position. While these amendments reverse amendments made in this House, they represent a sensible outcome. They will improve the Bill for blameless respondents to complaints. I hope that the overwhelming majority of honest and competent lawyers will be reassured by these changes. They encompass government amendments and two amendments moved by the honourable Member for Somerton and Frome on Report in the other place. I beg to move.

Moved, That this House do agree with the Commons in their Amendments Nos. 39 to 46.—(Lord Hunt of Kings Heath.)

Lord Kingsland rose to move, as an amendment to the Motion that this House do agree with the Commons in their Amendments Nos. 39 to 46, leave out “agree” and insert “disagree”.

The noble Lord said: My Lords, this matter can be dealt with exceedingly succinctly. The purpose of my tabling these amendments is to ask the Minister whether he is confident that what I take to be, essentially, Amendment No. 41 on the Marshalled List, which was included in the Commons amendments on Report, provides everything that the Bill as amended by the Lords provided on the polluter pays matter. I want to be confident that that part of the Bill that has come back to us on the polluter pays achieves everything that our successful amendment achieved. I beg to move.

Moved, as an amendment to the Motion that this House do agree with the Commons in their Amendments Nos. 39 to 46, leave out “agree” and insert “disagree”.—(Lord Kingsland.)



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Lord Hunt of Kings Heath: My Lords, the answer is yes.

Lord Kingsland: My Lords, I am much obliged. I pay particular tribute to the Minister because, as he is well aware, of all the issues that concerned your Lordships’ House on the Bill, this was perhaps the most important. I wish to pay the Government a handsome compliment. Thank you very much, indeed—in particular, I thank the Minister.

Lord Thomas of Gresford: My Lords, would the noble Lord also like to compliment the honourable Member for Somerton and Frome, whose amendment was accepted by the Government and achieved the result that he had sought in this House?

Lord Kingsland: Of course, my Lords. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

On Question, Motion agreed to.

Lord Hunt of Kings Heath: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 47. I shall speak also to Amendment No. 49. These amendments address cross-party concerns expressed both in this House and the other place that certain provisions in Part 6 fail adequately to protect the interests of legal services consumers.

In relation to Amendment No. 47, the Government listened carefully to concerns that the former redress limit would needlessly exclude a significant number of complaints. As a result, the amendment will increase the redress limit from £20,000 to £30,000. As noble Lords will recall, there was debate on the redress limit when the Bill was last in this House. There was also much debate in another place. The amendment will address the arguments made during the Bill’s passage.

At one stage a figure of £100,000 was proposed to the highest level. We have resisted that for three main reasons. First, because £20,000 is higher than any award available under the current legal complaints- handling arrangements; secondly, because the average awards made under the existing arrangements by the Law Society and the Bar Council are around £450; and, thirdly, because the Bill provides for the board, the OLC or the consumer panel to recommend an increase in the limit at any time. The Lord Chancellor does not to have to wait for such recommendation, but is able to ask any of those bodies to consider whether to make such a recommendation.

We know that the ombudsman for estate agents may award up to £25,000. I could not claim that I have absolute scientific evidence to suggest that £30,000 is exactly the right figure. It moves on the original figure, and I hope that noble Lords will agree that this is a sensible outcome.

Amendment No. 49 relates to an ombudsman’s obligation to refer a complaint to the relevant approved regulator when they take the view that the complaint may raise disciplinary issues. While

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ombudsmen are empowered to deal with redress, approved regulators, such as the Bar Council and the Law Society, will continue to deal with any disciplinary issues.

In circumstances where an ombudsman refers a complaint, this amendment will place a further obligation on ombudsmen to inform the complainant that their complaint has been referred to an approved regulator. Following a referral, an ombudsman will be able to continue to determine the complainant’s eligibility for redress.

The intention here is to enable a complainant to follow the disciplinary action taken against their lawyer. This amendment will provide important reassurance to consumers who may want to know that their lawyer will be appropriately disciplined for professional misconduct.

Moved, That the House do agree with the Commons in their Amendment No. 47.—(Lord Hunt of Kings Heath.)

On Question, Motion agreed to.

Lord Hunt of Kings Heath: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 48.

Moved accordingly, and, on Question, Motion agreed to.

Lord Hunt of Kings Heath: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 49 to 71.

Moved accordingly, and, on Question, Motion agreed to.

Lord Hunt of Kings Heath: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 72.

Moved, That the House do agree with the Commons in their Amendment No. 72.—(Lord Hunt of Kings Heath.)

Lord Neill of Bladen rose to move, as an amendment to the Motion that this House do agree with the Commons in their Amendment No. 72, leave out “agree” and insert “disagree”.

The noble Lord said: The amendment would restore to the Bill a provision that was agreed here on more than one occasion by votes; namely that Part 5 should not be brought into operation without further examination and report.

I should place it on the record that I was a member of the Joint Committee that considered the Bill. When I heard the Minister say that he was coming fresh to it, I rather envied him. Over the past 18 months, I seem

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to have done little else but think about the Legal Services Bill. Following the evidence that we managed to put together under the chairmanship of the noble Lord, Lord Hunt of Wirral, on that committee, I took the view that a case had not been made for why the extraordinarily wide provisions in Part 5 were necessary. We are talking about lawyers getting together with all sorts of other professions in various possible permutations of professional organisations. Over and above that, there is the possibility of funding by outside people and ownership by outsiders who would have no legal or other professional qualification whatever. That was an alarming prospect. The amendment would ensure that that did not happen until the matter had been reviewed.

One of the main concerns has been talked about earlier today; the noble Lord, Lord Thomas of Gresford, mentioned it. A good deal of evidence came out in Committee in your Lordships' House of the anxiety about the effect of Part 5 on access to justice. The note that struck a chord with everyone concerned what would happen to a couple of high-street solicitors in a small town if a bigger legal enterprise decided to open a wider partnership that involved all sorts of things in addition to law. No work that we could detect had been done on the social consequences of that policy.

The most potent spokesman for that anxiety was the former Lord Chief Justice, my noble and learned friend Lord Woolf. He said that devastating consequences could follow from the introduction of Part 5 unless people were aware of what they might be. The House heard contributions from other parts of the country. Wales was singled out and the Midlands and the north were mentioned by Members of this House who were able to relate personal conversations that they had had with local solicitors and others reflecting considerable concern about the effect of the Bill if enacted.

Another disturbing aspect came from the foreign legal profession. The German Federal Bar, the BRAK, has a large association that represents about 100,000 members. It wrote to the committee saying, “We put you on notice that no German lawyer would be allowed to have anything to do with a firm that is organised in the way envisaged or made possible by the Bill”, with outside shareholders and so forth. It would be regarded by the German legal profession and German law as totally unprofessional to be associated with any such body. That was in just one country. We made no inquiry into any other countries.

Noble Lords may recall a story. One of our protests in the report, which was made by the chairman, the noble Lord, Lord Hunt, was that we were given only four weeks from start to finish to produce a report. The amount of independent inquiry that we could make was virtually zero—we got together just a few home witnesses.

The amendment that I introduced in the Lords in the spring was voted on with big support from the opposition parties and found a place on the statute book. It called for a delay and a detailed report investigating the access to justice matter and the views of the foreign legal profession, so that we would have

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some feel for whether we were doing something wholly bizarre, avant-garde or rather good. That amendment was carried by the House. It was struck out at a very early stage in the other place; I did not follow it thereafter, but it did not surface again. We got the Bill back on Tuesday morning and we find that the provision about delay is no longer there. I therefore tabled this amendment to restore the position to where I believe it ought to be.

6 pm

I am not, as it were, trading assurances, but the minimum I want to hear the Minister say, if he is able to do so, is that this matter will be kept under close review; that, having got the Bill through, the Government will not close their eyes to the effect; that they will watch the economic effect in various parts of the country with an open mind; and that they will report back if there is information which shows that the fears I have expressed are correct. One would also hope that during the next five years, the Government would have better information on the attitude of foreign countries to the experiments taking place in this country. As I say, that is the minimum.

I wait to hear what any other Members of the House have to say. I do not know whether your Lordships require me to read out the detail of the proposal. In essence, it was that there should be a wide-ranging report by an independent body, which should be brought back to both Houses for discussion and voting on before Part 5 is introduced. That is the guts of it. I beg to move.


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