Select Committee on Northern Ireland Affairs Appendices to the Minutes of Evidence


Memorandum submitted by The Law Society of Northern Ireland

  As arranged, I enclose a Briefing Note we have prepared setting out the position of the Law Society of Northern Ireland (LSNI) in relation to the Government proposals for reform of the legal aid system in Northern Ireland.

  I hope that the Briefing Note will be of assistance to the Committee. Although we have drawn on the submission made previously by the LSNI in response to a Government consultation exercise, we thought it would be of most benefit to the Committee to present a reasonably self-contained analysis and critique.

  On the assumption that there will be some form of oral evidence taken, we hope to provide the Committee within the next few days with some supplementary materials which might be of further assistance. We have in mind a summary of the main points made in the Briefing Note, together perhaps with a matrix illustrating the points we make within the Briefing Note as regards average case costs in Northern Ireland. I shall ensure that these are forwarded to you as soon as possible.


  1.1  This Briefing Note is submitted at the invitation of the Northern Ireland Affairs Committee ("the Committee") for purposes of that Committee's inquiry into the future arrangements for publicly-funded legal services in Northern Ireland. As reflected in the terms of reference adopted by the Committee, the primary focus of the inquiry is on the decisions as to the future announced by the Government in a Decisions Paper—"The Way Ahead: Legal Aid Reform in Northern Ireland" (September 2000).

  1.2  The Briefing Note sets out the position of the Law Society of Northern Ireland ("LSNI") in respect of the Government proposals. We are appreciative of the opportunity to contribute to the work of the Committee. We offer this evaluation of the Government proposals from the distinctive professional perspective and experience of solicitors who have been in the front-line of provision of legal services since the inception of the Legal Aid Scheme.

  1.3  As the Committee will be aware, the Government proposals were preceded by several consultation exercises, of which the most recent was entitled "Public Benefit and the Public Purse" (June 1999). We have attached to this Briefing Note a complete copy of the LSNI Response to that Consultation Paper.[16] Where appropriate we cross-refer to comments made by us at that stage (in particular, the proposals for reform of criminal legal aid set out at pages 12-21 and Appendix B of that Response). Otherwise, however, in deference to the remit of the Committee and for ease of reference, we have attempted to follow the sequence and the broad subject headings set out in the Decisions Paper of September 2000.

  1.4  Accordingly this Briefing Note is divided into four sections:

    (a)  The Northern Ireland Dimension;

    (b)  Administrative Arrangements;

    (c)  Cost Issues (including alternative funding options, and the criminal legal aid proposals);

    (d)  Quality Standards.

  1.5  One other preliminary observation may by of assistance. Despite the prior period of consultation, there is a sense in which the reform proposals remain work-in-progress. Although the Decisions Paper provides an outline, a great deal of detail is missing. For example in at least three of the critical areas (setting of costs levels and the Funding Code; setting of quality standards; and alternative funding arrangements on the anticipated removal of civil legal aid) the Government accepts the need for further work to be undertaken by various means.

  1.6  Similarly there are various indications of a Government intention to bring forward contingent legislation to provide for fall-back positions in the event that the proposals do not go according to the Government plan. This in itself is an approach about which we have serious reservations, particularly given the intention to legislate by way of the Order in Council procedure. Again, in announcing the decisions the Parliamentary Secretary at the Lord Chancellor's Department made clear that the views of the Northern Ireland Assembly would be given weight. Finally because draft legislation is not yet available, many critical factors remain undisclosed or unexplored. For example, we have no cost-benefit analysis of the proposals, no assessment of the regulatory impact, no reasoned basis for the human rights validation of the proposals and no indication of the overall public expenditure implications or HM Treasury constraints.

  1.7  It is necessary to make these points first because, in an important sense, these as yet unknown matters are of considerable importance in assessing the acceptability or otherwise of the proposals. The devil may be in the detail, or the salvation in the small print. Secondly, to the extent that these factors remain unclear to the Committee, the LSNI or any other external commentators, of necessity some of the conclusions we set out in this Briefing Note are provisional only.


  2.1  Throughout the consultation process, the Government has espoused a willingness to find Northern Ireland solutions to Northern Ireland problems. Most recently:

    ". . . we recognise that the legal services landscape in Northern Ireland has a number of distinctive features and we indicated the Government's commitment to recognition of the Northern Ireland legal services culture which is distinct from that in England. . . . the Government stated intention is to modernise the administration and provision of publicly-funded legal services in Northern Ireland by delivering local solutions to local problems." (Foreword, "The Way Ahead").

  2.2  Again, quoting from the initial Consultation Paper, the Government has affirmed that the reform programme (stated to derive from the "modernisation" agenda) is directed to the objectives set out at para. 17 of the Decisions Paper.

  2.3  With due respect to the Government position, this statement of objective is in no meaningful sense radical or modern. These objectives have informed the structure and operation of the legal aid scheme, probably since its inception and certainly in the past decade. There may be scope of course for argument as to the imperfect achievement of those objectives, or the effectiveness of the mechanisms by which they can be achieved, but there is unlikely to be any major disagreement as to the common sense of the objectives.

  2.4  We share, of course, the aspiration that any reforms implemented in Northern Ireland should be related to the context and culture of legal services provision in the Province. Nor do we devalue the extent to which the Decisions Paper purports to take account of the Northern Ireland context. However, we think there is good reason to suggest that the extent to which the distinctive nature of the Northern Ireland legal landscape has been understood is limited and superficial; and that the overall package of reforms has been driven by false a priori assumptions, particularly that the starting-point for reform is the same as in England and Wales. As a result we believe there is good reason to think that the proposed reforms in several key respects have within them the seeds of destruction of what have been widely recognised as the peculiar strengths of the Northern Ireland arrangements for access to justice.

  2.5  A full understanding of these distinctive features is vital if the stated intention of the Government is to amount to more than a token and cosmetic adaptation of the English agenda.

  2.6  While there are many respects in which Northern Ireland practice is different, we believe it will be of most help to the Committee to concentrate on two areas to provide a suitable backdrop against which to develop an informed critique of the Government proposals. These areas are:

    (a)  the network of small local community-based firms providing access to a wide-range of general legal aid and advice services;

    (b)  the cost effectiveness, in absolute and comparative terms, of the legal aid and advice services provided under the current legal aid system.

  2.7  In respect of the network, the total number of solicitors in private practice in Northern Ireland is 1,650. They operate in some 500 practice units. Just under 50 per cent are sole principals (who may, of course, have employed assistant solicitors). Another 25 per cent are two-principal firms. Just under 90 percent are in partnerships of three principals or less. All the available evidence suggests that a wide range of advice services is being provided at reasonable cost. The value of this network has been widely-recognised, including, in some limited respects, by the Government. Yet in several other respects the Government proposals, whether intentionally or otherwise, have the potential to seriously damage or destroy this community-based legal service.

  2.8  The Government has espoused development of specialisms in areas of work where the need for specialisation has not been established, apparently as a function of Government scepticism about the ability of small (one or two solicitor) practices being able to provide a quality level of service across a wide range of legal issues. We wish to refute this scepticism in absolutely clear terms. In the vast majority of instances it should be possible to provide for any necessary degree of enhanced expertise by other means while preserving the general-practice nature of the bulk of solicitors work (whether by continued access to the Bar, or as is increasingly the case, by referral arrangements between solicitors).

  2.9  The Government espouses the role of a bulk purchaser of legal services on behalf of the tax payer, an argument which makes sense only if services are to be supplied through bulk service-providers.

  2.10  The Government espouses a system de facto of duplicated and alternative regulation of solicitors' small business units which is wholly disproportionate, may result both in an increased incidence of financial failures, and is likely to produce an exodus of firms from the network, combined with a significant additional burden on the tax payer by way of the administrative costs of regulation by the Legal Services Commission. We repeat the warning in clear terms. The net effect of the proposals is that there is a high risk that the widespread and developed network of privately-capitalised and accessible advice units in Northern Ireland will contract, with solicitors being obliged of necessity to disengage from unprofitable or low-margin work, with serious detriment to those who have ready access at present to the justice system.

  2.11  To avoid any misunderstanding on this point, we wish to make clear also that the LSNI has no interest in promotion of uneconomic or inefficient practices. Nor are we other than supportive of the development and funding of a more comprehensive range of advice services in conjunction with the voluntary sector. However, the opportunity should be taken to build on the strengths of the present Northern Ireland arrangements, particularly the ready-made network of community-based legal practices.

  2.12  The extent to which there has been a failure by the Government to understand in any real depth the distinctiveness of this jurisdiction is exemplified by reference to the overall structure and shape of the reforms proposed. There is an apparent, if limited, recognition of the Northern Ireland dimension within the Decisions Paper, such as the non-suitability of exclusive contracting. We accept this recognition as given in good faith, but in each instance the recognition is limited and contingent, and the fallback provision is the "full-blown" English model. The structure, ethos and derivation of the proposals is transparently "the English solution". What is proposed, subject only to some conditional deferment, is unmistakably the English model, miniaturised in some modest respects. It is a regional adaptation of a national model, not a model designed for a distinctive, self-contained and parallel jurisdiction.


  2.13  The second distinctive feature of Northern Ireland practice concerns costs. Within the overall rhetoric of reform, the Government has attempted, by the use of highly selective and unrefined statistics, to assert a major costs "problem" in Northern Ireland. This mantra has included overall unsustainable costs; absence of control; absence of value for money. In all cases the objective has been to assert a need for major reform, ostensibly in the interests of the tax payer, by creating the impression of a system which is expensive (in absolute and comparative terms) and inefficient.

  2.14  It is in this respect that the Government approach is seriously wanting. Throughout the process of reform to date the Government has been singularly unwilling to face up to the hard evidence which suggests strongly that the legal system and the frontline practitioners who service it within Northern Ireland, provide a good value, good quality product at a reasonable cost in the context of chronic under-funding. In one sense the Government's determination in this respect is explicable because it is clear that the identification of a "costs problem" is the key justification and driver for the reform proposals, as has been the case in England and Wales. Without it there may be every reason to suspect that the reform agenda is in fact more about cost-savings and Treasury imperatives than enhanced administration and improved access to justice.

  2.15  This is why the Government consistently refers to the overall level of legal aid expenditure over the past five to 10 years, without any evinced serious intention of coming to grips with a proper understanding of the cost drivers and dynamics involved. This is a complex matter (illustrated by cross-reference to Appendix C to the LSNI Response to the Consultation Paper, "Public Benefit and the Public Purse").

  2.16  In absence of any refined understanding of the developing costs picture in Northern Ireland, what does the available hard evidence suggest? We would respectively urge the Committee to pay special attention to this issue. All of the available evidence suggests that legal aid in Northern Ireland is not expensive by reference to the services and access to justice it delivers, and that there has been an historical tendency to under-fund legal services (whether provided by the private sector or the not-for-profit sector). In Northern Ireland the facts are these:


Northern Ireland
England and Wales
AEstimated Population (millions)
BLegal Advice and Assistance—payments to Solicitors (£ million)
CLegal Aid—Solicitors charges and Counsel's fees, Disbursements (£ million)
DTotal (B)+(C) (£ million)
EGross expenditure per head of population (£) ((D)÷(A))
FNet Expenditure (£ million)
GNet expenditure per head of population (£) ((F)÷(A))


Northern Ireland
England and Wales
AEstimated Population (millions)
BNet Expenditure (£ million)
CNet expenditure per head of population (£) ((B)÷(A))

  2.17  These figures are of considerable significance for a number of reasons. They demonstrate that the overall level of public expenditure on these services in Northern Ireland is consistently lower than the rest of the United Kingdom, despite the fact that it is generally accepted that the proportion of the population falling within the legal aid and advice eligibility limits may be higher here. The figures reflect also that, across a wide range of categories of legal advice and legal aid work, the per case cost in Northern Ireland is consistently lower than the rest of the United Kingdom.

  2.18  In summary, all of the available evidence suggests that much of the reform process has been founded on some highly questionable premises as to the costs dynamic in a developing and increasingly sophisticated legal system.

  2.19  We would invite the Committee to consider this alternative analysis of the core question at the heart of the Government reform agenda, which claims to be a Northern Ireland solution to a Northern Ireland problem: namely, what is the Northern Ireland problem? Further we invite the Committee to bear in mind this analysis and this core question when considering the examination below of the several strands of the reform programme (administrative arrangements; costs and funding reforms; and quality standards).


  3.1  The Government proposes the establishment of a Legal Services Commission which will take over administrative responsibility for criminal and civil legal aid from the LSNI. It will be tasked also to take forward issues such as quality of work, research and pilots. The present arrangement for independent oversight (by way of the Lord Chancellor's Advisory Committee) will be abolished.

  3.2  On the key proposal (transfer of administrative responsibility from the LSNI) we affirm again that we have no objection in principle. We welcome the Government's tribute to LSNI administration over some 35 years of operation of the Scheme, throughout a turbulent period of history and in the face of many difficulties.

  3.3  We do not accept all of the reasons put forward by the Government for the transfer. For example, the conflict of interest asserted against the LSNI is misconceived. The fact that the LSNI has been required (on a voluntary basis) to wear two hats is not of necessity wrong in principle, nor unprecedented in British constitutional terms. It is less than fair to those who devised the Scheme in 1965 to suggest, under the guise of modernisation, that no thought was given to the implications of the present Scheme. It is clear in fact that, correctly researched and understood, the present arrangements were designed carefully to strike a proper and principled balance. That is why the primary role of the LSNI was defined and limited to the business of administration (not the development of policy). The power to legislate (by regulations) as to policy and the operation of the Scheme (including regulation of the costs to be paid) was vested in the Secretary of State (and latterly, since 1982, the Lord Chancellor), and specifically not the LSNI. An independent body (the Advisory Committee) was established to oversee and advise the Lord Chancellor and the LSNI administration of the Scheme and the efficacy of those arrangements.

  3.4  We think it is misleading also to suggest that the administrative reforms made elsewhere in the United Kingdom some 10 years ago were ignored or disregarded in Northern Ireland. The decision by the Government not to move to a Northern Ireland Legal Aid Board at that time as based on considerations of proportionality (that the costs of the Board administration might not be justified by reference to the benefits to be achieved) and that improved administration could be achieved by other means. This led directly to a number of important administrative reforms, agreed between Government and the LSNI, and now in train. These include, incidentally, a proposal to bring into the structure the type of business and financial expertise now advocated by the Government. This reform process is beginning to produce some tangible benefits and, in that sense, the establishment of a new administrative body can be regarded as a logical extension of the reform process already under way.

  3.5  We do recognise and understand the widespread support for a new administrative settlement, and we can appreciate that it can only inure for the benefit of the LSNI to have removed any misperceptions of conflict of interest. This is why we have never sought to retain administrative responsibility at all costs or as a matter of principle. Given this, we have not thought it necessary in this Briefing Note to rehearse the administrative development of the present scheme in detail. We can expand of course on paragraphs 3.3 and 3.4 above as the Committee should require. Otherwise for present circumstances we intend to proceed on the assumption that a transfer of administrative responsibility to a new body of some kind is agreed, and will be implemented.

  3.6  We need to confirm again, as we have done already to the Government, the LSNI commitment to work constructively with the Government in connection with any transfer ultimately sanctioned by Parliament. We have two objectives in mind here. First to ensure that the administrative reform programme on which we are embarked is continued through until the point of transfer, so as to ensure the administration is in good shape at hand-over. Secondly to ensure that the hand-over process itself will proceed as smoothly and efficiently as possibly.

  3.7  Having made these points clear, and pending fuller information from the Government, particularly as to the establishment and administration costs of the proposed Commission, we are obliged to reserve our position on matters of detail and drafting.

  3.8  In the meantime, however, we think it necessary to signal some preliminary points of concern regarding the particular model proposed. We have some reservations as to whether the Legal Services Commission structure is proportionate to the scale and nature of the legal services issues in this jurisdiction. We have already suggested that the Northern Ireland "problem" (to which the Commission is part of the solution) is of a different order in some respects, or to a different degree in some others, than suggested by the Government.

  3.9  To quote directly from the Parliamentary Secretary, speaking on publication of the Decisions Paper:

  "I do not want to impose a Westminster designed system in Northern Ireland".

  3.10  With respect, the administrative model proposed for Northern Ireland, as with so much of the reform package, is transparently a Westminster designed model. The list of responsibilities to be discharged by the proposed Commission (see paragraph 46 of the Decisions Paper) is virtually indistinguishable from the English Legal Services Commission. The only modifications appear to relate to its size of membership, and a signalled intention by the Government that some of the powers to be conferred on the Commission are not expected to be exercised in the short-term.

  3.11  It may be worth considering again whether this particular model is more elaborate than required for this jurisdiction. There are other simpler NDPB models which may be instructive and more suited for adaptation to this jurisdiction (one of the most obvious example being the Legal Aid Board model in Scotland). This is not a reservation we make idly, for no purpose, or limited to considerations of value-for-money. Experience of direct rule in Northern Ireland shows that the creation of derivative structures will almost inevitably lead to derivative policies and practices. The relationship between major and the minor models will lead to the adoption of policies and practices, under the direction of the same Minister (the Lord Chancellor) which are based on the same and mistaken premise that what is done in England and Wales should be done in Northern Ireland, in absence of justification to the contrary. We do not believe that this second-hand and derivative approach is right in principle, or suitable for Northern Ireland. This is why we suggest that it may be worthwhile for the model to be reviewed and critically evaluated to test whether a simpler model might not be implemented here which would secure the same objectives. Obviously this is a suggestion we would be willing to explore in more detail with the Government.

  3.12  Again, to avoid any misunderstanding on this point, we need to make clear that we do not suggest that the new administrative body should be other than independent of the LSNI, but equally that it should be able to operate cost-effectively in a way which secures genuine independence of judgment and operation.


  4.1  Of the elements in the Government reform package, perhaps none displays more the fundamental deficiencies in the Government's approach and understanding than Chapter 5 of the Decisions Paper. We refer again to the points already made about the inadequate and unsatisfactory foundation on which these proposals are constructed. We point again to all of the available evidence which suggests that there remains a significant short fall in expenditure on publicly-funded legal services in this jurisdiction; that the widely-acknowledged efficiencies of the Northern Ireland legal process combined with the supply of a suitable range of services at reasonable cost produces an acceptable costs-model, within the terms of the present legislation, and on the remuneration and funding principles already in place.

  4.2  These factors, combined with the absence of reliable research into the complex costs dynamic, suggests that the Government has no meaningful understanding of, or interest in, being put to the test of providing a proper rationale for the extensive and disproportionate measures set out in Chapter 5.

  4.3  Throughout the consultation process, and despite several attempts on the part of the LSNI to engage on this issue, the Government has refused to acknowledge the significance of the available costs evidence. Nor have we been given any real reason to think that the Government has any interest in establishing a more empirical basis before framing and implementing these costs proposals. We return again to another statement of intention by the relevant Minister:

  "This is a local solution to the problems connected with legal aid here; not a model from elsewhere which is being imposed".

  4.4  By reference to these statements, we need to place on record that there is no material sense in which the range of powers and "solutions" proposed by the Government in Chapter 5 of the Decisions Paper differs from the proposals being implemented in England and Wales under the auspices of the Legal Services Commission there. A clue to the Government thinking and priorities can be found at paragraph 90 of the Decisions Paper. This paragraph needs to be read in the context of the facts we have already provided as to the actual cost-efficiency of the Northern Ireland system, and in a context in which there was an almost unanimous response from within Northern Ireland as to the unsuitability of exclusive block contracting for most categories of legal services in Northern Ireland because of the inevitable and serious detriment to those who need ready access to justice. The paragraph is worth quoting in full:

    "The Government is committed to reform and trust that, with the goodwill of the profession, the proposals in this paper for case and cost control can be carried through without having to invoke the alternative of exclusive block contracting. This will, however, remain on the Government's default agenda should agreement not be forthcoming on the schemes set out in the Decisions Paper."

  4.5  The LSNI does not have, and never has had, any difficulty with the principles of accountability for public funds and delivering value-for-money. We also have no difficulty in making commitments to work constructively with the Government on any costs, or indeed other, proposals for reform. The LSNI has never taken a dogmatic position against standard or scale fees. However, paragraph 90 suggests strongly that the Government had some pre-determined costs objectives which, if not achieved to the satisfaction of the Government, will lead to the imposition of a "solution" which is acknowledged as wholly unsuitable for this jurisdiction.

  4.6  Against this background, the LSNI considers that a proper and full explanation of the Government's public expenditure objectives needs to be made clear. Perhaps we can focus discussion on these matters by posing some questions (there may well be others) which the Government should be prepared to answer frankly and openly. These are as follows:

    (a)  what are the projected costs of setting up the proposed Legal Services Commission?

    (b)  what are the projected annual running costs of the proposed Legal Services Commission for the first three years following its establishment?

    (c)  other than the costs associated with the establishment and running costs of the Commission, what does the Government project as the amount available over the first three years following implementation of each of the new budgets for civil non-family; civil family; and criminal?

    (d)  what commitments have been made to, or parameters set by, HM Treasury for projected expenditure on legal aid advice and assistance in Northern Ireland over the next five years (commencing April 2001)?

  4.7  For the reasons indicated, the LSNI remains unpersuaded either as to the need for, or the efficacy of, the costs reform measures set out in Chapter 5. There is no evidence in Northern Ireland that application of the "fair and reasonable remuneration" principle, now to be abandoned by the Lord Chancellor, has resulted in any unacceptable overall levels of public expenditure on legal services in Northern Ireland.

  4.8  On the contrary, all of the evidence suggests that the operation of the present system and principles has resulted in lower per capita cost, and lower per case cost (and across a wide range of categories of case) than in the rest of the United Kingdom. This fact is of particular note and importance because the comparative costs being paid in the rest of the United Kingdom are determined by reference to criteria similar to those now proposed by the Lord Chancellor for introduction to Northern Ireland (see paragraph 55 of the Decisions Paper). The LSNI considers that this demonstrates again, and reinforces, the need to avoid wholesale and indiscriminate adoption of "solutions" from other jurisdictions in absence of any properly informed and convincing analysis of the need for reform in this jurisdiction.

  4.9  By reference to the specific proposals in Chapter 5 (Funding Code, Standard Fees, etc.), much will depend upon the detailed working through of these proposals. We will be seeking to engage with the Government on these issues.

  4.10  By reference to proposals for criminal legal aid, we refer the Committee to pages 12-21 of the previous LSNI Response. We commend the position set out therein, both as an exemplar analysis of legal aid delivered through the network of practices in Northern Ireland and as a set of constructive proposals to address the Government's concerns in this particular area of expenditure.


  4.11  Before addressing matters of detail, it is worth recording that we address the question of what funding alternatives might be found—and to what extent—in the aftermath of the Government's policy decision to withdraw public funding, as far as possible, from cases warranting access to justice where those involve a compensation claim.

  4.12  It is Government's position that others, principally the insurance market, should be able to bear the risk in its stead. And the only basis upon which such others might be prepared to bear the risk is that, on a swings and roundabouts basis, they are likely to make a profit. The Government had previously been providing indemnity in such cases on a not for profit basis. It has moved on to conclude that the expense is insupportable (a proposition which we consider to be highly questionable in Northern Ireland) and has therefore decided to let others take over, on a profit-orientated motivation. We deeply regret that.

  4.13  We remain of the view that assuring access to justice for those of limited means with a reasonable cause of action is the responsibility of the community, through Government, in any civilised society. It has been the privilege of lawyers to assist toward that end up to now. Northern Ireland solicitors, in particular, have honoured the code and have delivered the service at an economic rate of pay, both in absolute terms and also as compared to anywhere else in the British Isles. Of course, as well as offering the insurance industry more money to take it away, the Government would also have liked to have offered more money to solicitors for the same reason. All this extra money on offer does not come from Treasury, which appears to be the key Government objective.

  4.14  We continue to hold to the view that there is great danger for the public in relying upon the insurance industry to deliver access to justice. We look at the situation which the Government has allowed to develop in England and Wales and we consider it to be deeply flawed.

  4.15  We hold the view that the unfettered freedom to choose one's own independent legal advisor is a critical element in countering the potential for exploitation and profiteering which is inherent in the process of opening financial claims to legal expenses entrepreneurs.

  4.16  The Government acknowledges the distinctive culture in Northern Ireland, where solicitors typically supply legal assistance, funding and representation to the public in no-fault claims for free. Solicitors rely instead upon recouping their outlay and obtaining their fees at the end of the claim, from the opposing party's insurers. That has profound implications with regard to whether legal expense insurance is in fact necessary for individual claimants.

  4.17  This is already an active issue in Northern Ireland. Many people fall outside the very restrictive financial eligibility levels for legal aid. For many others, the contribution which may be levied under legal aid sharply exceeds the cost of alternative insurance arrangements. In addition, the cost of such after-the-event insurance will vary widely, from the reasonable to the exorbitant.

  4.18  The public is entitled to independent advice as to whether they need to purchase funding arrangements at all and, if so, in what form and where. At present, they are being manipulated by passive sales techniques, by tied brokers and, increasingly, by advertising into commitments to particular insurance providers before being afforded access to independent advice.

  4.19  One of the Society's core objectives is to preserve the network of small, efficient law firms in the province. The established practice on the part of most insurers in requiring that the insured uses only a solicitor nominated by the insurer is a serious threat to that network. Such panels have nothing to do with quality control. There is no Code of Practice. There are no known admission criteria, no tendering, no advertising. It all turns on the standard provision whereby the insurer, not the insured, commands the choice of solicitor. By the Government's own admission, this is an immature and unregulated market.

  4.20  That is the context in which the Government concedes in its Decisions Paper that ". . . the large number of small solicitors' practices providing a general service does provide a very different background for the introduction of CFAs than in England or Wales". It is the context in which it states than ". . . in practice, there is a long way to go before CFAs can be developed for Northern Ireland".

  4.21  We prefer to say that the insurance providers have some way to go—some of them a very long way to go—before they can be regarded as offering a service which is appropriate for Northern Ireland and in the wider public interest.

  4.22  It is necessary to be quite clear about what is at stake. It is not the preservation of work for lawyers: the work remains—it even grows in response to proactive advertising. Members of the Council of the Law Society presently report an excess of job vacancies for young solicitors, across the province. Individual firms on these insurance panels will grow larger and need more staff. Solicitors who find the local supply of work in a critical sector to be drying up, will follow the work. The phenomenon taps into an underlying trend among the younger labour force to prefer city life anyway.

  4.23  On the other hand, when the insurance industry has completed its work, created bulk suppliers of personal injury claims services, tied to individual insurers, where then the independent solicitors' profession?

  4.24  The issue is about continuing to deliver wide-ranging legal services to the public throughout the Province in an economic and efficient way. That is presently delivered by small practices providing a general service, in partnership with the Bar.

  4.25  For these reasons, we consider it to be of critical importance that, at a minimum, the reputable sector of the litigation insurance industry reviews its policy with regard to panels. A good comparison is with mortgage lending institutions. In the Northern Ireland home loans market the same issue arises, where national building societies have an inherent preference for larger law firms. Nonetheless, they have been able to adopt a more flexible approach here and to continue to admit sole-principal firms to their panels—all firms, in fact, which meet basic criteria. Significantly, many of the lenders have been able to justify this distinctive Northern Ireland approach by reference to the LSNI Home Charter quality-assurance scheme. The critical factor is that they have abstained responsibly from using their power to artificially reconstruct the legal services market. It remains the case that people can freely choose their own local solicitor to handle the house purchase. That is what we want to see continue in the personal injuries sector.

  4.26  The second priority is that the public should be free to choose how to fund their litigation. We have already made the point that the Irish system (for it applies in the Republic as well) includes free funding to the point of settlement, in no-fault claims.

  4.27  The Decisions Paper is singularly obscure at paragraphs 69 to 71, the key observations with regard to alternative ways of funding litigation. Taken at face value, the observations suggest that the Government has no intention of introducing CFAs in the short term, that CFAs and a CLAF are just two of a range of possibilities whereby ". . . a mature legal insurance market . . ." can be developed in Northern Ireland which will fund "appropriate" cases.

  4.28  At this stage, the LSNI is actively involved in considering all options for future funding for money damages claims without prejudice to our fundamental position that unless the very major problems with all such alternatives can be resolved, the Government should remain prepared to accept that legal aid funding, perhaps in a modified form, should continue to be available to support this category of litigation.


  5.1  The Society has no objection to the proposition that all legal service providers, including solicitors, who wish to provide legal services at public expense should be required to register with the Legal Services Commission. It was always the position under the Legal Aid Scheme that continuance of the right to supply such legal services was subject to the power of both the Society and, indeed, the Independent Disciplinary Tribunal, to exact a range of sanctions, up to and including removal from the Legal Aid Panel for unsatisfactory or improper services or conduct. This, therefore, is merely a concomitant part of the transfer of administration from the Society to the new Commission, so far as solicitors are concerned.

  5.2  On the other hand, the Decisions Paper states that legal services bought with taxpayer's money must be demonstrably of a consistently high quality. This is the only stated rationale for the Government's decision to depart from the previous arrangements, whereby the regulation of solicitors (as officers of the court) and the investigation of complaints against them was a matter for the Law Society, under supervision of the independent Lay Observer, with disciplinary proceedings prosecuted before the independent Disciplinary Tribunal and ultimately subject to the appellate jurisdiction of the High Court.

  5.3  In his Foreword to the Paper, the Parliamentary Secretary of the time, David Lock, MP, asserted that the Government is committed to recognising the distinctive Northern Ireland legal services culture and is intent upon delivering local solutions to local problems.

  5.4  In the context of monitoring quality standards, it is the Society's contention that the Government has imported English solutions with a determination to find problems to fit them.

  5.5  At the launch of the Decisions Paper, the Parliamentary Secretary expressed his approach in a slightly different way. He conceded that he had been informed that the quality of legal services in Northern Ireland was high, but the "problem" was that this was not subject to any form of verification. On that basis it has been deemed necessary to introduce a Code of Practice and more especially a regime of external audits and inspection by the Legal Services Commission.

  5.6  No-one would wish to argue with the proposition that legal services must be of a consistently high quality. On the other hand, the Decisions Paper fails to explain why it is necessary to transfer quality assurance to an external regulator in order to achieve a credible process.

  5.7  There is no reasonable basis for asserting that only persons who are obtaining legal services from solicitors with the assistance of taxpayer's money ought to expect that the service be of consistently high quality.

  5.8  There is no effort made by Government to assert that it has found any cause to believe that the services presently provided to the public by solicitors in Northern Ireland is of unacceptable quality. The Lord Chancellor's Advisory Committee on Legal Aid in Northern Ireland and the Northern Ireland Human Rights Commission, for example, told it precisely the opposite. It has failed to listen. It has paid no attention to the favourable Users Survey contained in the Bloomfield Report on the Northern Ireland Criminal Injury Scheme, the favourable Users Survey which is included in the Northern Ireland Consumer Council's Report on The House Buying Process, or the Northern Ireland Office of Law Reform's favourable Research Report on Matrimonial Law. These are the more recent independent appraisals and, notably, cover a range of different services supplied by small generalist practices.

  5.9  It is likewise in the interests of taxpayers that new tiers of bureaucracy are not charged to public funds without demonstrable evidence that the investment is cost-effective; Government makes no effort to adopt a benchmark for itself, to state what is currently of an unacceptable standard from legal aid solicitors, and the extent to which it expects that the proposed initiative will ameliorate such a situation.

  5.10  The proposal threatens to introduce, without justification, a new tier of external regulation for small businesses in a manner which, by its nature, will make no allowance for the existing extensive, demanding and effective levels of monitoring and discipline to which private practice solicitors are subject.

  5.11  No weight has been given to the contention that the effective and proportionate way to secure quality standards from a mature, self-regulating but small profession of proven track record is to engage with its professional body in order to enhance current regulatory provision and monitoring—for the benefit of the public as a whole.

  5.12  The declared decision, as framed, represents a serious derogation from the independence of a self-regulation profession; it effectively introduces a new regulator for solicitors and contrasts with decisions by Government with regard to other areas of quality assurance from the solicitors profession. As evidenced by the policy underpinning the Immigration and Asylum Act, and other sectors such as financial services and insolvency regulation, the principle of proportionality is well-established. That is, that there may be circumstances (particularly with reference to scale) in which it is more appropriate to operate through the mature, established professional body. In national terms, it is perhaps worth reiterating that the Government is embarked here upon the task of measuring a minnow.

  5.13  The Society welcomes the decision by Government, in the face of what is understood to have been widespread and independent criticism (with the possible exception of the not for profit sector), to set aside proposals to introduce contracting generally for legal aid solicitors in Northern Ireland. The Society believes that a widespread network of small, efficient and cost effective practices is the proper formula for this Province. Solicitors already cope with an extensive range of regulation and monitoring in return for the privilege of serving the public. Where many firms, most especially outside the Greater Belfast area, will be involved with legal aid only for the purposes of the occasional petty sessions case, whether criminal or matrimonial, it is difficult to conceive that they will apply for registration with the new Legal Services Commission. It makes little sense for them to commit to the significant expense entailed in the Government's proposal for duplicated regulation.

  5.14  The Society therefore predicts that if Government proceeds to introduce an external regulator as envisaged it will significantly reduce the availability of legal services to the public, more particularly in rural areas, without the slightest demonstrable evidence that the quality of service previously available was anything less than suitable. This is the consequence of the Government choosing to play Doubting Thomas, wishing quality to be externally verified by resort to a third party regulator, despite all the available testimony.

  5.15  At the most fundamental level, the Government's approach to the Northern Ireland system is inherently self-contradictory. It states that it has been persuaded that it is not feasible to introduce a system of franchising and contracts here. It has recognised that it cannot deliver bulk contracts to solicitors on a Province-wide basis because there is an insufficient volume of casework in any category of civil law, in particular, to allow it to herd such work into a sharply reduced number of authorised providers without an unacceptable level of inconvenience and obstruction for the public seeking access.

  5.16  On the other hand, bolted on to the alternative scheme, and with a very superficial rationale, is a feature which will cause many firms to conclude that the expense and trouble involved in continuing to supply a publicly-funded adjunct to their other business is simply not cost-effective.

  5.17  This in fact is not an issue about quality assurance at all. It is an issue about proportionality and needless duplication. The Government has failed to acknowledge the logical consequence of the fact that it cannot deliver bulk casework to the existing network of small firms throughout the Province. It insists upon trying to exact a price from each firm for the privilege of continuing to service legal aid work while seeming to have forgotten that, in the case of many firms, it cannot deliver such a volume of work as would make that price affordable.

  5.18  The Government's decision effectively spurns the Society's public offer to engage in meaningful and constructive discussions with a view to advancing and further assuring the current plans for enhanced quality services across the full range of solicitors' services. The Government has elected not to engage with the Society in an exploration as to whether its prerequisites can be accommodated within the self-regulatory environment, to take no stock of all the Society has been engaged in these several years to demonstrate its commitment to high quality service from its members, to disregard all independent views as to what has been achieved, but to proceed straight to statutory intervention; and all this despite failing to articulate any plausible contention that the standards which the public receive from Northern Ireland solicitors, no matter how they are funded, are unacceptable.

  5.19  A review of what has been engaging the Law Society even just over the past year demonstrates the fact that we are fully committed to ensuring a consistently high quality of service for the public.

    —  We have re-vamped our domestic conveyancing quality-assurance scheme, the Home Charter, and made it compulsory for all solicitors as from January 2001. It has been in operation on a voluntary basis for most of the last decade and involves a system of inspection just as the Government espouses for legal aid work. We note that the Government Homes Bill is, in effect, catching up with Northern Ireland in respect of this initiative, save that the "sellers pack" here does not include a survey report.

    —  January 2001 also saw the start of our compulsory professional education programme whereby we will reach the position that every practitioner will be required to undertake attendance at further education courses as an integral part of professional practice.

    —  Last year, we launched the first Advocacy Training course for solicitors. 25 solicitors, drawn from a heavily over-subscribed application list, completed a nine-month course of night classes on advanced evidence, followed by a week's intensive training run by the National Institute of Advocacy Training of America. This year's course is once again heavily over-subscribed.

    —  We have produced a Client Care Code of Practice for Family Law practitioners (notwithstanding the fulsome praise extended in the Office of Law Reform's enquiry into present standards). Other Client Care protocols will follow.

    —  We have launched the Lexcel quality assurance scheme for solicitors' practices and already have one firm through the process and duly accredited. Several others are in the pipeline.

  5.20  The Society is a body with which Government could usefully talk, with a view to securing a Code for the various kinds of legal aid casework and in a way which is proportionate.

26 February 2001

16   See the list of unprinted papers, p. xvi. Back

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