The battle for legal aid

Far from being a ‘fairer deal for legal aid’, the government’s proposals for fixed fees and competitive tendering could kill the legal aid system stone-dead. Issue 47 of Socialist Lawyer is a special on legal aid, with seven contributions on different aspects of the system. The first, by Carol Storer, is below.

How is it possible that proposals from the Department of Constitutional Affairs (DCA) (as it was until 9th May this year) and the Legal Services Commission (LSC) which were welcomed by the Law Society and Legal Action (in part at least) have now reached such a low point?

The recently published House of Commons Constitutional Affairs Committee Report summarises the current position:

"There has been a catastrophic deterioration in the relationship between suppliers, their representative organisations, and the LSC. Unless the relationship improves, we do not see how implementation of these reforms can be successful. We urge all involved in legal aid reform to re-engage in a more constructive dialogue." (Report, 1st May 2007)

Reviews and consultations

In July 2005, ‘A Fairer Deal for Legal Aid’ was published. This set out a strategic way forward for legal aid and Lord Carter was appointed to review the procurement of legal aid. He subsequently produced proposals for a competitive market based system for legal aid procurement based on quality, capacity and price. Over 2,300 responses were received to the consultation on Carter’s Report.

‘Legal Aid Reform: the Way Ahead’ was subsequently published in November 2006. Although it was stressed that responses had been taken into account, the direction of travel remained very firmly set. At the end of February 2007 the LSC published the proposed unified contract. It had to be signed by the end of March 2007 to enable providers to continue with legal aid work from 1st April 2007. Some of the detail to go in the specifications to that contract is still under negotiation.

Richard Miller is the Director of the Legal Aid Practitioners Group (LAPG). His concerns about the flurry of plans, consultations and re-consultations by the LSC were highlighted in an LAPG press release on 4th March 2007 and this was referred to by the Select Committee: "Today I have downloaded nineteen pdf files from the Legal Services Commission website, including annexes and regulatory impact assessments. This is on top of consultations published earlier this month on police station boundaries and the very high cost criminal case panel, not to mention the negotiations on the new unified contract. I am paid full time to keep on top of the LSC’s initiatives, and I can barely cope with this blizzard of publications. How on earth can any practitioner who is trying to conduct a substantial caseload to a high standard be expected to do so? The sheer volume, speed and extent of the changes is liable to destroy the legal aid system even if the substance doesn’t."

Current proposals

There are proposals for integrated social welfare law ‘outlets’ in 125 areas. Whether they will still be called Community Legal Advice Centres (CLACs) and Community Legal Advice Networks (CLANs) we do not know. The first one was announced in May in Gateshead; the law centre, CAB and three firms have joined together to bid for and run this CLAC.

What is the aim? To provide a holistic service as people have clusters of problems – they should be able to get advice and representation under one roof or at least from one organisation. It will also reduce the LSC administration cost as it will deal with one organisation i.e. one contractor not with lots of different contractors as at present.

What we do know is that for suppliers in an area where there is a tender to run the social welfare law provision it seems highly unlikely that they will be able to continue carrying out legal aid work if they are unsuccessful in the bid. There is no new money coming through so the only way a CLAC or a CLAN can be funded is by putting all the money in that area into that body. And taking away the contracts of others in that bid zone.

Fixed fees start in October this year. A survey by the Housing Law Practitioners Association of its members revealed many of them would not be financially viable to continue delivering work at the rate of Ł171 plus VAT. Solicitors acting for landlords may well receive that for less than an hour’s work, but solicitors acting for tenants or the homeless will receive Ł171 for the whole case, funded under the legal help scheme. There has been a decision not to pay any more in London which is of huge concern in view of the number of black and minority ethnic clients advised and represented in London. The LSC is aware that London practices will be under huge financial pressure and are likely to withdraw from legal aid. Its argument is that in a fixed budget it has looked at the effect over the whole country and underfunded regions outside London will benefit. The fear with fixed fees is what sort of service will people who have complex cases get? And what about people whose cases take longer, if English is a second language or if the client has mental health problems? While the LSC will point to an escape mechanism (if cases take three times longer than the average the hourly rate will be paid) it will be time consuming to monitor contracts and organisations will have to balance providing advice and remaining solvent.

The LSC is under pressure to cut Ł30 million of its administrative overheads by 2011. However, organisations fear that they will continue to face micro-management by the LSC and will have to absorb even more administrative overheads themselves.

The Access to Justice Alliance

The Access to Justice Alliance was formed in November 2004 and has been campaigning ever since, focusing on civil issues in particular social welfare law. It is supported by community groups, national charities, lawyers, advisers and others who feel strongly that justice should remain accessible to all. (See www.accesstojusticealliance.org.uk for a full list).

The Alliance believes that the funding crisis facing legal aid cannot be ignored any longer. The Alliance calls on the government to:

Resource the whole legal aid scheme so that both civil and criminal work can operate within a realistic budget. This means protecting the civil legal aid budget to stop it being used to cover rising expenditure on criminal legal aid.
Compensate the legal aid budget for the costs of new policies and initiatives.
Co-ordinate spending by government departments and local authorities on independent legal and advice services and oblige them to contribute appropriate funding.
Review and revise the eligibility criteria and extend legal aid for representation in tribunals to ensure that people of limited means can access justice.
Guarantee quality standards in publicly funded legal and advice services.
Provide co-ordinated funding for strategic and education legal services (including test cases), social policy, law reform and other non-casework services.

The Alliance, formed before July 2005, might have been expected to welcome the LSC goals but the proposals that month led to an increase in activity not a decrease. The LSC vision is often admirable but huge changes are being proposed at a time when many experienced practitioners have given up or are pulling out of legal aid work. Wholesale change without careful analysis of pilot projects is a huge gamble.

Users

What do the reforms mean for users of legal aid? We simply do not know, they have not been consulted about the proposals. A recent discussion paper from Legal Action Group ‘Developing the Users’ Perspective’, discusses this democratic deficit. It argues not only that consulting users is in itself the right thing to do but that user input improves services.

Will there be enough suppliers?

Numbers dropped in April 2007 as some organisations decided to stop carrying out legal aid work then rather than wait any longer. The notice provision for providers to terminate contracts is three months. It is possible that more firms will terminate their contracts. One of the difficulties faced by providers was when the terms of the contract were announced, at the end of February 2007. People may well have signed up in March 2007 to buy enough time (April – September this year) to pull out of legal aid work or to close down. Dexter Montague, a firm in Reading committed to legal aid work, made the decision to give it up. What about after round one? It seems unlikely that organisations will be around to bid three years later when re-tendering takes place.

This is a sector where there has been virtually no increase in rates over the last ten years and where already over 8,000 organisations have left legal aid work since franchising started in the early 1990s. There is great uncertainty over the future.

Black and ethnic minorities

Lynton Orrett, on behalf of the Black Solicitors Network, and Sailesh Mehta gave evidence to the Select Committee highlighting the effect on black and minority ethnic communities. Firms that grew up to work with communities expect to have to merge to survive. But that was not the reason why they grew up as they did – mergers would move them further from their client base. Although there were discussions with Carter about funding costs of mergers, that has not happened.

Where do we go from here?

Are there any positives? Will centrally planned social welfare providers be able to operate successfully? Will current providers end up employed and still providing top quality advice and representation? What are the risks on quality? There is a quality threshold but it is not high. It can be argued that users of legal aid face problems now. In the future there will be fixed fees and organisations set up to provide advice and representation within a fixed budget.

The LSC would point to CLS Direct as a partial response to the challenges; anyone can now access advice by telephone in social welfare law. Eligibility checks take place after initial advice is given.

The LSC would argue that by funding CLACs and CLANs there will be certainty and there will be cover.

New competitors are likely to arrive and it will look like protectionism to say that that is per se a bad thing. The legal services bill going through parliament means that it is more likely that traditional firms and organisations will change.

Conclusion

There are at least three judicial review cases going through the courts challenging current proposals. The Law Society has put considerable resources into the ‘What Price Justice?’ campaign. Some private practices are pulling out of legal aid work. The not for profit sector was warned that it would lose up to 50% of its funding. Gateshead CLAC will start operating and others will start trading; the first CLAN for example may well be in Cornwall.

At an Access to Justice Alliance meeting recently, Alan Beith MP, Chair of the Select Committee, stressed that while fixed fees were hogging the headlines in fact the bigger threat was competitive tendering. The government must be hoping that marketisation can deliver high quality advice and cover the country. And that everyone who is expressing concerns are wrong. The next few months are crucial.

Carol Storer is a solicitor in a not-for-profit agency and member of the Steering Committee of the Access to Justice Alliance, and is writing in a personal capacity.

This article can be found in the print edition of Socialist Lawyer number 47, July 2007.