Update on Criminal Legal Aid

Update on Criminal Legal Aid

On 16 October, the Law Society Council resolved to:

1. Note and support the concessions and amendments to the Government’s initial proposals that have been achieved via the Society’s engagement with the MoJ.
2. Note that the Society opposes uneconomic or inappropriate fee structures.
This short paper summarises the presentation given to Council. It sets out what has changed between the April and September consultations as a result of the Society’s engagement, the detail of the new proposals and the Society’s position going forward.

The MoJ’s original proposals

3. On 9 April, the MoJ presented a consultation document proposing a radical restructuring of criminal legal aid procurement. That document proposed:

3.1. Complete removal of client choice – clients allocated to a duty solicitor and expected to remain with that solicitor for the duration of their case.

3.2. Just 400 contracts covering 42 procurement areas – a small number of contracts covering geographically large Criminal Justice System Areas.

3.3. Contracts awarded on the basis of a price competition, capped at 17.5% below present rates – firms forced into a high risk reverse auction for contracts, with the risk of a ‘race to the bottom’ to secure a contract.

3.4. A very short timeframe with contracts set to begin in September 2014 – Just three months planned between contract award and contract start.

April – September: Law Society engagement and the MoJ’s revised proposals

4. Prior to the consultation launch the Lord Chancellor made his preference plain:

“We must consider how to achieve best value for money in the way we procure legal aid. We have already made clear our intention to introduce price competition in the criminal legal aid market.”

5. Announcing the second consultation in September, he said:
“We have been involved in detailed negotiations with the Law Society. As a consequence of these discussions… we have designed a model that does not include the evaluation of tenders on price.”
6. The Lord Chancellor’s movement was the result of intensive and constructive engagement between the Society and the MoJ. Acknowledging – though not accepting – that there is at present no consensus in any political party to ring-fence legal aid spending the Society sought the best achievable alternative in the circumstances.

7. The Society presented an alternatives document and subsequently held discussions with the MoJ. The September consultation is the outcome of those discussions. It means:

7.1. Client choice retained – Clients free to choose their legal representative. All firms who meet a basic quality threshold able to undertake unlimited own client work in England and Wales.

7.2. Duty contracts tendered on capacity and capability, not price – Duty solicitor contracts will be awarded on the basis of an assessment of a firm’s capability and capacity to deliver.

7.3. Contracts across 62, rather than 42, procurement areas with the final number of contracts to be decided on the best available evidence – the maximum possible number of contracts compatible with financial viability will be awarded subject to independent empirical research.

7.4. Timeframe extended to summer 2015 – Implementation rescheduled to aid transition.

The Society’s action going forward

8. As emphasised by the Chief Executive, the Society’s concern is to ensure that as many criminal solicitors as possible are able to continue practising criminal law.

9. The Society will therefore seek further modifications to the consultation proposals to ensure that, as far as is possible, they are viable for criminal providers In particular, the Society will seek further modifications to the proposals to ensure that:

9.1. Decisions about contract size are made subject to the best available evidence– In order to ensure that the maximum number of contracts compatible with financial viability are awarded, the Society and MoJ  have jointly commissioned Otterburn Consulting to research firm finances.

9.2. There is maximum flexibility with regard to structure of those submitting a bid– The Society will be ensuring that consortia arrangements are permitted.

9.3. The single national police station fee is varied to reflect local conditions, particularly in London and the South East – A rapid move to a single national fee could mean a reduction of over 30% in London and the South East.

9.4. An escape fee is included for the most serious police station cases – While generally a ‘swings and roundabouts’ principle applies to police station attendances, some cases are so complex and lengthy that they impose disproportionate costs.

9.5. Plans to pay flat fees in the magistrates’ and Crown Courts, no matter what the case outcome, are reconsidered – Fees should be revised to remove any perception of a financial incentive to encourage a particular plea.

10. Provide practical advice and support for firms to adapt their businesses and, where appropriate, merge or form consortia – The Society’s overriding objective is to create the conditions under which there are maximum possible opportunities for solicitors who wish to undertake criminal legal aid. The Society is therefore preparing a programme of work aimed at providing the practical support, advice and template documentation necessary to help firms through future challenges.