Legal Aid Inquiry
I thank Roger Hamilton, the policy and legal director of the Legal Services Commission, for coming to give evidence for our legal aid inquiry. Roger did not have time to prepare an advance submission, so he will make a short opening statement.
Roger Hamilton (Legal Services Commission):
I have had the benefit of reading one or two of the Official Reports of evidence that has been given to the committee, including that of Alan Paterson, so I have a broad idea of some of the committee's interests and concerns. Unfortunately, I did not have a great deal of notice of this meeting, so I could not prepare a written submission. It may help if I outline our analysis of some of the problems that have concerned the committee and if I said what we have done about them.
The starting point in England and Wales is the "Modernising Justice" white paper, which was published in December 1998 and was the product of much work that had been carried out over some years. The white paper contains a relevant and apposite analysis of legal aid problems south of the border. It describes six characteristics of the legal aid system that were considered no longer acceptable and that the reforms were intended to change.
The first problem was a large and increasing budget over which there were no effective controls and which had increasing unit costs in the cases that were being funded. The second problem was that the service that was provided was largely unplanned and fragmented. The third problem, which was crucial, was that there was little or no control over quality. The fourth problem was that the legal aid system was considered to be biased towards expensive and court-based solutions; there was inadequate access to up-front advice and assistance that could obviate problems or prevent them from turning into litigation and becoming more serious later. The fifth problem was that the system was considered to have a far too general merits test for funding cases, which allowed many cases of rather dubious priority into the system. The sixth point, which is very important, was that little information about the service was available, so that the ordinary punter on the street had little idea where to go for help, whom to turn to and what they could expect when they got there. That was the guts of the analysis in the white paper, which is still worth reading.
The white paper produced a four-point solution. The first point was that we had to replace the existing system with a more planned one in which we could allocate resources in the light of priorities. The idea was not to sweep everything away and replace it, but to build on the existing service by moving it in the direction of the results of planned analysis of need.
The second major plank of the reforms was contracting. We have adopted a wholly contracted system. From April this year, all publicly funded services south of the border have been provided under contract to the Legal Services Commission.
The third plank was shifting from the rather general merits test that was based on the reasonableness of a case in the eyes of a lawyer to a more flexible merits test that focuses on priorities set by those who are in charge of the system—the Government and the commission, aided by partnerships with local authorities and other funders, who were involved in analysing and consulting on true legal need. Our funding code is flexible. It can be changed relatively swiftly as new priorities appear and old priorities fall away.
The fourth plank of the reformed system is the directory of quality-marked suppliers—a website gives internet-based access to it—which means that, for the first time, we have a complete guide to who provides services to the standards that we require, where they can be found and what work they do. That is beginning to transform access to and knowledge about the system for ordinary people who seek services.
How were those planks translated into legislation? The Access to Justice Act 1999 established the Legal Services Commission and gave it broad set of powers. The powers were broadly intended to achieve the four planks that I described. The way in which the system works—a question that has interested the committee—and the relationship between the Lord Chancellor and the Legal Services Commission as a non-departmental public body are interesting. We have broad powers, but the Lord Chancellor also has broad powers under the act to control what we do, through directions or orders.
The best analogy is that the system is a bit like an airliner in which the commission comprises the co-pilot and the cabin crew. We can fly the airliner ourselves; we do not need the Government to help us, except by providing money. However, some key risk points exist—particularly take-off, landing and bumpy weather along the way—at which the captain, in the form of the Lord Chancellor, may take over the controls, or at least direct us on what to do. The areas in which the Lord Chancellor is interested in running the controls are fairly obvious: the scope of the system, remuneration and financial eligibility. We will give him advice on how we think those matters should develop and he will take our advice or leave it and make his own decisions.
The 1999 act requires us to make direct reports. We have a close and increasingly good relationship with the Lord Chancellor's Department, which works more in partnership than it used to. The department accepts that we run matters day by day. The department must inevitably intervene when things get difficult—when press stories appear, for example—but that is done on a partnership basis. Usually, the department is happy with how we run matters and will become involved only in broad-brush policy questions.
As the commission's chief lawyer, I used to be frustrated, because we wanted to change the system in all sorts of ways but we could never find parliamentary time to alter the detailed regulations. Now we have a set of contracts where, essentially, the rules are dictated between us and the providers. If things need to be changed, we can simply negotiate a change with our providers and change the specification under the contracts. The Lord Chancellor's Department needs to agree to that, particularly if the changes are important, but the process is quick and effective. Over six weeks, we operate a quick consultation under the contracts. We then give six weeks' notice of the change, after which the change is made. We can move fast and are no longer trammelled by many of the difficulties that we used to face in keeping the system up to date and moving ahead.
Basing the new system on contracting achieves four critical aims. First, we can meet our priorities through letting contracts. We can decide where to let a contract and the category of law; there is also a new method of delivery that involves telephone access rather than the traditional service. We therefore have enormous flexibility on the type of contracts that we let. The Access to Justice Act 1999 merely gives us the power to do that. It does not dictate terms—those are for us to decide. Secondly, contracting is a way to control the budget. I will come to that shortly. Thirdly, contracts aim to set and monitor standards. We have built on the franchising system that pre-dated the legal aid reforms. What we call the quality mark under the new, reformed system is a basic qualification for any provider to get a contract. Fourthly, contracting allows us to refocus resources on all kinds of new providers. In particular, it allows us to bring in the advice and not-for-profit sectors and to begin to fund the services that they can best provide. We now fund a wide range of mediation services in the family sphere and are spending around £25 million to £30 million on the not-for-profit advice agencies.
That is a thumbnail sketch. I want to move on to what has happened as a result of the changes. The community legal service started in April 2000 and the criminal defence service commenced only in April this year, so those services are very new. It is too early to make long-term judgments, but some points are worth sharing.
The first concerns the scope of cuts south of the border. Those are not necessarily an integral part of the new system. They came from a simple prediction that the costs of the system would exceed its budget, which meant that some hard decisions had to be made when the new system was implemented. It was decided to exclude from the scope of legal aid those cases where people were most likely to get help on the market through insurance systems, after-the-event insurance and conditional fees, for example, although they would not get a perfect service on the market. The Access to Justice Act 1999 liberalised the conditional fee system.
Those decisions were political and have been controversial. Without the deficit in the budget that was anticipated, the measures would not have been necessary. That is all that I want to say about them. They mean that personal injury cases, some business cases and others of that ilk are no longer funded unless there is real public interest in them.
The second point concerns contracting. We have concentrated the supply side into around 5,000 to 6,000 offices throughout the country. About 5,000 offices do civil work under contract and around 300 to 400 are not-for-profit advice agencies. On the criminal side, we have about 2,900 offices, many of which are the same as those on the civil side, because the office does civil and criminal work. That is why I say that we have between 5,000 and 6,000 offices throughout the country.
We are convinced that the franchising system—and the quality mark that now replaces it—has been effective in improving quality. It has not been completely effective, but it has been a necessary start. We know that it is criticised for being bureaucratic—it probably is more bureaucratic than it needs to be and we must address that. On the other hand, all the research evidence that we have, as well as the evidence from solicitors and the not-for-profit sector, is that the most advanced providers are saying that they are glad that they achieved the quality mark—it was painful, but it improved their services. The quality mark is a good base mark and is the basic qualification for entering into contracting.
Where we are going now is largely dictated by the research report that the Legal Services Commission is publishing today. That is a major study of some of the pilot contracts that we ran in the lead-up to the reforms. It tells us that, although the quality mark is a pretty good start, it is not as effective as it should be. In particular, about 20 per cent of the firms who have quality accreditation through us are not delivering to acceptable standards. We instinctively recognise and accept that research conclusion. We need to develop the quality mark criteria to take account of outcome and competence checks rather than input and process checks. That is the direction in which we are likely to move.
The other point that has been of considerable concern to the committee is control over the budget. I have read your discussion on whether there should be a hard cap or a soft cap on the budget. That is an important debate. We now have a series of levers, which represents a string of controls that, over time, can begin to contain and control expenditure. We do not have a hard cap. We have budgets that are allocated by the Government. However, if we ran out of money during any period, we and the Lord Chancellor's Department would consider that a major disaster.
One of the committee members—I forget who it was—asked what would happen if there was a 19th murder case when we had allocated money only for 18. That would obviously be a disaster—it is no way in which to run the system. Our controls do not run like that; they run in a much more sophisticated way. As I said, they give us a series of levers through contracts. Those levers allow us to control case starts in different areas, to fund new services in other areas and to tell suppliers that we no longer want to fund services that are not a priority. The system moves much more slowly and in a measured way in the direction in which we want to go.
The other crucial point is that we now operate on a three-year budget cycle. That is critical. Legal aid is a large ship and expenditure on legal aid does not turn round quickly. Even if we put a brake on the expenditure by cutting the scope or reducing eligibility, that takes some time to work through. A three-year planning cycle gives us a much better way of staying within the budget that has been allocated to us than an annual budget does. It allows us to carry forward overspends and underspends and to begin to predict what will happen in the three years. That is a much easier task.
We have moved from some pretty crude controls, which caused real problems in the system, to a much more sophisticated set of controls. The committee may remember that the major brakes on the previous system, which were used when the Treasury got nervous and wanted to pull back funding, were to cut scope, cut eligibility or freeze remuneration, all of which produced serious problems. I am pleased to say that, under the new system, we are—as far as I can see—beyond the need to use such crude controls.
The first effect of what we have done is to create headroom in the budget. We have increased remuneration this year for the first time for several years. We are also about to increase eligibility. It is interesting that, in his evidence to the committee, Alan Paterson argued the case for increasing eligibility at the first advice and assistance level, which in our system is now called legal help. His argument was along the lines that it is important that wide services are available and that a lot of people can be helped at that level, as it is the first access point in the system—the first point of contact. Our system is like the Scottish system. The eligibility for up-front advice and assistance is restrictive. When someone obtains a legal aid certificate to proceed to litigation, the eligibility is a bit more generous.
The first step that we are taking later this year will be to increase eligibility for advice and assistance. We think that something in the region of a further 5 million people will be brought into the system as a result. There are some pretty helpful effects of being able to predict and control the budget with the series of levers that I described.
My next point relates to who controls the detail of remuneration and regulation. It is horses for courses now. We control a lot of detail in the contracts. We obviously check what we do with the Lord Chancellor, but if something needs changing, we will change it. We do that in consultation with the profession, the not-for-profit providers and the consumer groups. Other features of the system, such as remuneration, will always remain in the control of the Lord Chancellor. That is critical, as such features have a direct effect on the budget, which will have to be negotiated and agreed—we still have annual settlements.
However, even though the Lord Chancellor controls remuneration, we have moved to a much more strategic view of what we use remuneration for. Remuneration used to be an annual negotiation between the profession and the Lord Chancellor's Department in which a series of legal aid fees would be fixed in regulations and would remain fixed until there was further negotiation.
Now we do something quite different. We use remuneration as a key ingredient of our planned access and service development strategy. For example, last year we identified a shortage of contracted providers in certain key spheres. One was immigration, another was community care services and a third was mental health. We simply increased the remuneration for advice and assistance in those areas and left the rest alone. That was an encouragement to suppliers to provide the services that we needed in those areas.
This year, there has been considerable concern about the number of family contractors, a lot of whom were beginning to worry about their profit margins and whether they could stay in the system. The problem that they face is that, in most family cases, they do not get costs orders from the other side; they rely on their legal aid fees. For a damages claim, lawyers can get from the other side costs orders that are much more generous than the legal aid fees, so a proportion of their income is much better paid. Family lawyers had a problem: they did not have access to the benefits of costs orders from the other side. Their income was falling behind that of other lawyers. This year, we have simply raised the rates for family suppliers across the board by 10 per cent—and, indeed, more for those who are prepared to become accredited to the Law Society of England and Wales children panel or the Solicitors Family Law Associaltion panel.
We are beginning to use remuneration far more strategically to ensure that we have the services on the ground that we want and need. There is little argument between us and the Lord Chancellor's Department. We do the analysis, which the Lord Chancellor's Department discusses with us. Out of that emerges a strategy that is put to the Lord Chancellor and the Treasury for future funding.
That is all I want to say in opening. I hope that it is helpful.
I will pick up on your last point. You talked about being able to take a more strategic view with regard to fees. However, it strikes me that you basically have a series of taps and are busy running along turning one tap off and another on whenever you see the basin beneath it getting dry. I am not sure that that is as much a strategy as just finding out where there are problems from year to year and putting in more resources to meet them.
It is a strategy because, over a period of time, we are reshaping the supplier base to accord with what our regional legal services committees, which are involved in assessing need on the ground, say the need for services is in the priority areas.
This is not a game in which there can be a once-and-for-all solution. Things develop rapidly. We need to be able to move perpetually in the direction in which we are being told that the system needs to move. If we do not control the budget and are too generous with the system, we will hit further budget crises, and so be forced into some of the cruder controls that have previously been in place. We have managed to design a contracting system that prioritises and targets the resources to what are considered to be the greatest priorities. That system has saved quite a lot of money and I have already told you how some of the savings have been put to use.
We have also managed to make savings by squeezing quite a lot of waste out of the system. We have done that by redefining the rules of the game in our contracts and by taking a far greater degree of control over the problem of high-cost cases, an issue that was not much discussed in "Modernising Justice", but which has since emerged as fairly critical. In any system there will always be litigation cases that cost an inordinate amount of money. Our system is no exception. Some very high cost cases that we are running consume £500,000 or £1 million per case.
Often those cases begin with lawyers saying, "Yes, it's a dead cert winner". We spend £500,000 on the case, by which time the prospect of success has fallen to 50 per cent. We spend another £250,000 and the prospect of success has fallen to 40 per cent. In the past, those cases have carried on being funded to their unsuccessful conclusion. Now we haul those in, give them special treatment, consider them closely, seek independent opinions and turn off the tap where there is little justification for going on. We turn the taps on and off according to where we see the priorities lying. That must be done continually to keep the system going in the appropriate direction.
One argument that was put to us by the proponents of a legal services commission was that it would allow a more strategic view to be taken. I am not quite sure who is taking the strategic view in your case. Is the Lord Chancellor taking the strategic view simply on the advice of the Legal Services Commission? In other words, is his role nominal? Alternatively, is the point that there is now someone in a position to give him the strategic advice that he did not have previously?
I do not think that the Lord Chancellor would ever accept being called the nominal anything. He is firmly in control. We have regular briefing meetings and he has a good grasp of the issues.
The process is rather complicated. We are very committed to partnerships with other funders and suppliers who are involved in legal service advice and assistance and representation, principally local authorities and the many advice groups that they fund. On a regional basis, we have set up partnerships that carry out a needs analysis in their area and produce local plans. The local plans are widely consulted on among community groups, other funders and all suppliers in the local area. Out of those plans a regional plan is developed which outlines the priorities, the gaps in the service and the directions in which people want to go.
The regional plans feed upwards and are considered nationally by the commission. They are analysed and formed into an overall strategy, with a budget attached to that. That strategy is sent to the Lord Chancellor for approval. Obviously, the Lord Chancellor is not involved in the detailed consultation on the ground, but he is involved in considering the overall direction and thrust of what we are doing and sanctioning it.
You have probably already answered several of the questions that we intended to ask you. However, Nora Radcliffe has a question.
I have a daft- lassie question. Could you describe what a typical contract is? Is it for an individual case, a series of cases or a period of time?
We did quite a bit of research on that before we came to a conclusion about what our contract should be based on. We are paying for time for solicitors. We are paying for time for the not-for-profit sector as well, but in a slightly different way. The research showed us that, out of the different pilot contracts that we were running, the best quality results came from carrying on paying for time and that is what we decided to do.
We have devolved a lot of power to solicitors to decide how much work to do within certain limits. They simply get on with that work and bill us for it, but they are required to tell us up front the number of cases that they are starting monthly. With that information and knowledge of the average case costs for each firm in each area of law, we have an up-to-date profile of what the expenditure will be. That was one of the other deficits of the previous system—we had no idea what was in the system. Today's work is a bill that will be presented in one or two years' time. We had no idea of what we were in for. Now we have a much more up-to-date view of the budget and can predict what it is going to be in a year or 18 months' time and what our resource call on the Government will be.
In the not-for-profit sector we are funding caseworker posts, with the expectation that each post will deliver 1,100 hours per year. Those contracts are also time-based, but are measured by half-posts and full posts.
What freedom does the commission have in introducing new types of service on an experimental or permanent basis?
We have considerable freedom. Indeed, one of our statutory duties is to investigate, promote and expand new and innovative service delivery. We are running pilot contracts for different types of service delivery.
One of the most important means of delivery is telephone access, which is used to fill gaps in supply, particularly in provincial areas. Another is second-tier contracting. We fund nationally acknowledged experts for other suppliers who give front-line advice. Those experts identify weaknesses in the advice given, put on training courses and prepare material that can be used. That is just beginning to take off. We are about to launch a pilot to provide duty solicitors to deal with housing repossession cases in our county courts. That has been run on a shoestring up to now, with far too few courts covered and too little quality in the system. We intend to roll that out nationally. Those are just some examples.
What about the corollary? What about withdrawing or restricting particular services?
After the initial scope cuts that accompanied the introduction of the new system, the emphasis has been on expansion. We quickly got a decision from the Lord Chancellor to extend services to the immigration appellate authorities, which was an excellent development. We are now funding those under contract. We have just started funding three new tribunals, which we are told that we must fund because of the requirements of the European convention on human rights. There is a big debate going on in the Government as to whether we should extend funding to other tribunals. Many differences of view are expressed in the Government and we await the outcome with interest. We now have contracts and suppliers that could easily gear themselves up to deal with that should it happen.
Where did the decision come from to extend the coverage to the three tribunals? Did you give advice to the Lord Chancellor on that? Presumably it would require a statutory instrument.
Indeed. I think that it came from the internal governmental review on human rights compliance. We were asked to comment and we thought that there were areas where the Government would be at risk if it did not provide funding. The three tribunals that are being funded deal with situations in which people's livelihoods and liberty are at stake. They were pretty ripe for funding in ECHR terms.
Are there circumstances in which you would be proactive? Would you say to the Lord Chancellor that you are not allowed to fund a particular type of appeal in a particular tribunal and that you should be able to do so?
Yes, indeed. We were involved in advising the Lord Chancellor about the extension of funding for immigration appellate authorities. We saw that as a wholly beneficial move, given the importance of the cases. Our suppliers had difficulties in providing advice and they then had to leave their clients unaided at the door of the tribunals.
Nora Radcliffe asked a question about withdrawing particular forms of assistance. You talked about expansion, but surely you cannot simply squeeze stuff out of the system all the time to allow you to expand? I assume that there is no area from which you can withdraw service.
We have clamped down on some services, which we considered were not adding value. A good example is in the welfare benefits arena where, in a sense, we shot ourselves in the foot. In the early 1990s, we encouraged solicitors to get involved in welfare benefits. A weakness of the legal profession was that welfare benefits were an area of the law that traditionally solicitors knew nothing about. They could not help their clients, yet clients need holistic treatment: clients going through divorces need good welfare benefits advice. We encouraged solicitors to get involved in that subject.
We found that, although some solicitors responded well, others set up automatic welfare benefit checks which, in nine cases out of 10, provided no added value whatsoever. The checks were done whether or not the clients asked for them, and we received the bill for that work. It was a complete waste of time. It is interesting to note that the not-for-profit sector, which understands that area of law as it has a tradition of involvement in welfare benefits, assists clients through the process to the tribunal level and identifies cases where there are problems.
In our contracts we saved quite a lot of money by writing out the possibility of doing more unrequested welfare benefit checks. It provided no deficit in service and allowed the money to be recycled into something more useful. That sort of tinkering is important in refocusing resources.
I am interested in the Legal Services Commission's funding. What is a soft cap? Does it mean that there is no limit to your spending? Has the Lord Chancellor said, "Mr Hamilton, you know what I have in mind"?
Clear budgets are set. If those budgets are exceeded, difficult decisions have to be made. Parts of the system, including criminal representation, continue to be demand-led. If the system is looked at from the Government's viewpoint, it is a hard cap. Budgets are allocated, and if we exceed them, we have to find savings from elsewhere in the Lord Chancellor's Department budget.
From our point of view, the system works rather differently. We now have many levers to control the expenditure in the system. That helps us to live within our means much less painfully than used to be the case. We are steering the ship in a way that, over a period of time, aims to bring it in within a certain budget. The levers are soft—they do not say that we cannot help the next client who walks through the door. They change the profile of the suppliers and of their services, so that the suppliers focus on priorities and live within the overall budget. If we get it wrong, difficult decisions will have to be made. The cap will then be found to be a hard cap.
So you are not saying, "Our budget is about to be overspent. We had better look to squeezing certain types of cases out of the system." Do you find yourself in that situation?
We could do. If we were to find ourselves in an overspend situation, the Government could opt to ask us to retrench current services, let fewer contracts, make access harder, toughen the funding code criteria or put in place higher hurdles for high-cost cases. The only other option is to provide more money. In the end, that decision is political. We have a series of levers that we can pull that make it more likely that we can live within our budget allocation.
I am also interested in the question of flexibility. You talked about endeavouring to meet unmet needs once those were recognised. You quoted the example of immigration law. How do you establish that there is an unmet need? If, all of a sudden, you need to look for practitioners to meet such a need, how do you control the quality of the service?
Quality control is a slightly different issue. We have a quality control system to which all our providers are required to subscribe—it is built into our contracts. That ensures that the provider has a minimum standard of management practices to run their business and keep their files. Those requirements also ensure that each case is supervised properly by someone who is an expert in the field.
As I explained earlier, local initiatives identify unmet need in a partnership process between our local committees and other funders such as local authorities, the Community Fund—the National Lottery Charities Board as it was known—and so on. They meet regularly in partnership and come up with a plan for their area, which is put out for community consultation. That process results in a plan that the partnership is happy with and which can then come to us for funding approval. It is then down to the regional director to let contracts that aim to meet the need that has been identified. Where there is money to do so, new contracts are let all the time.
Would you look only at types of cases for unmet need or, if people were not accessing legal aid because they could not afford their share of the payments, would you look at eligibility?
Eligibility has to be one of the gross controls that is handled at the centre. We have relaxed eligibility rules in some limited ways. In the not-for-profit contract, we allow providers to count non-eligible clients up to 10 per cent against their contract hours. Traditionally, providers were not used to means-testing as they helped all sorts of people on a first-come-first-served basis. Relaxing eligibility rules has eased the transition for public funding through the legal aid system rather than through grant funding, which did not require a means test to be applied.
We are likely to extend that principle. The housing repossession scheme will not have an eligibility test. If someone is at court facing a legal case for possession that day, they will be able to access a free duty solicitor and a couple of hours of follow-up advice. We are beginning to look at the relationship between eligibility and access. We control that work pretty closely from the centre as, if eligibility requirements are loosened in a major way, there are large funding implications.
You said that one of the ways that you might encourage solicitors to take up particular cases would be to pay them over the odds for doing so. Is that the case?
Yes. We would not like to say that it is over the odds. Many solicitors would say that even the increases are well under the odds.
Of course not. I should declare an interest at this point. My husband is a solicitor and a legal aid practitioner.
But he never gets paid over the odds.
They are being paid more than others are being paid. We see that as a legitimate part of the planning process.
Does the commissioner have a role in revising the fee scales over time and in the light of inflation? Are there difficulties in attracting providers? You touched on that earlier, but could you clarify some of the points that you made?
We have very detailed knowledge of where the pinch points are in the system. We have a limited number of contracted suppliers. We know who they are and they come to us with their problems. That makes it much easier to tell where the pinch points in the system are. We are revising our views all the time on what the remuneration structure should look like. That forms part of the overall strategy. We are asked regularly to advise the Lord Chancellor's Department on remuneration and on the direction in which it should move.
What kind of response does the Lord Chancellor generally give?
That depends on whether we are before or after an election. We have yet to see what will happen now. When the community legal service was first introduced, the Government's stance was that it was not about increases in remuneration, but about a different and better way of doing the business. We quickly realised that there was a shortage of specialist practitioners in certain areas and advised on the first increase, which was in the social welfare areas of immigration, mental health, community care and so on. Our advice was accepted and the increase was implemented fairly quickly. It was not part of the annual round; it was introduced in July, because we thought that there was an urgent need for it. This year we were involved in creating a package with the Lord Chancellor's Department, which was put to the Lord Chancellor and the profession for agreement and was implemented on 2 April.
What scope does the commission have to become a provider of services through solicitors or other staff?
Under the Access to Justice Act 1999, we have powers to provide the services that we need to provide—by funding others, by employing people ourselves or by setting up an organisation to provide the services. We have very flexible powers. We could establish a new law centre or our own office. Members are probably aware that we recently opened four public defender offices in four different towns—three in England and one in Swansea. We have the same powers on the civil side as we have on the criminal side. For the moment we have opted for a limited pilot on the criminal side. Another couple of public defender offices are in the pipeline and will open over the next few months. We have decided not to use our powers on the civil side, because we think that it is fairly well supplied. We see no need to get involved in starting businesses in that area.
You have experience of setting up the Legal Services Commission. If we were to establish such a commission in Scotland, are there any lessons that we could benefit from?
We proceeded very quickly, because we had to meet some political priorities. One consequence of that is that we have driven in change at a rate of knots. People working in the legal profession in England and Wales would say that they are punch drunk with the change that is coming out of the Legal Services Commission.
For changes to be made, deadlines need to be set and people have to be forced to accept them. We have encountered a great deal of resistance from the legal profession—I can be quite open about that—which has made our task harder. The lesson that we have begun to learn is that we need to consolidate the gains that we have made. We need to slow down the process of change. We need to work much more in partnership with our providers to ensure that they are comfortable with the direction in which we are moving. We should spend more time explaining, discussing and negotiating that with them.
I would like to follow up that issue. I am conscious that your response is predicated on the present structure of the commission. If it were to be established again, would you like different powers or structures to be put in place? Would you like the commission's remit to be different?
The legislation under which we operate is spot on. There was one difficulty on the criminal side, which resulted from a drafting error, and we had to find parliamentary time to rectify that. However, the 1999 act has established a balance of controls between the Government and the commission that works very well. There are no real difficulties.
Some parts of the scheme—mainly those binding the client, such as the statutory charge and the clawback provisions—are still governed by regulation as they cannot be dealt with in our contracts with providers. Changes in those relatively limited areas can be made only by going through the old system. However, we were closely involved in drawing up those provisions and we are fairly comfortable with them. They are up to date and will not require huge changes in the near future.
I missed part of your evidence, so you may already have provided this information. How much does it cost annually to run the commission?
I have brought some figures on our budget, as I thought that the committee would be interested in that. The total budget this year for the civil and criminal legal aid system in England and Wales is £1.633 billion. That is divided between the community legal service and the criminal defence service. The budget for the community legal service is approximately half of the total legal aid budget—£708 million. The combined budget for the criminal defence service is £925 million. Approximately 50 per cent of that funds magistrates courts and summary jurisdiction and the remaining 50 per cent funds the Crown courts and higher jurisdiction.
On the civil side, about £475 million is spent on lawyers litigating with certificated funding. The balance of £232 million goes on the advice and assistance system. We now control that area quite closely through contracts. We have most leverage over the budget of £232 million, for which we can turn the tap on and off. All grants and innovative service delivery contracts are included in that budget.
We were asked about the cost of quality assurance, and I have had some thoughts about that. About 335 staff across our regional offices are involved primarily in contract and quality management. That includes letting contracts and auditing suppliers against them, but not paying the bills. Total staff costs are about £10 million. That amounts to just under 1 per cent of the global budget.
You have been through various budget headings, but I am interested in the total cost of running the commission. Are you saying that that comes to about 1 per cent of the overall budget?
No, I was referring only to the quality assurance system. The overall administrative cost of running the commission's services is £70 million. That is somewhere in the region of 4.5 per cent of the total budget.
How many staff do you employ directly?
Excluding the public defender offices, we employ about 1,500 people.
Thank you for your evidence, which has been very useful. I now welcome the Deputy Minister for Justice, Iain Gray, who is accompanied by Alisdair McIntosh and Ian Allen. I understand that the minister wishes to make some opening remarks.
I am glad to be here this afternoon to answer the committee's questions. I understand that you may raise quite wide-ranging issues on the operation of the legal aid system. As I might not be able to answer every one of them in detail this afternoon, I will be happy to follow up any such questions in writing.
As you pointed out, convener, I am accompanied from the justice department by Alisdair McIntosh, who is head of the access to justice division, and Ian Allen, who is the head of the legal aid branch. In view of the broad scope of the committee's inquiry, it would be helpful to know whether it intends to take further evidence from the Executive before it completes this part of its work. Beyond that, I will limit myself to a few opening remarks and then try to field any questions.
As members might know from their previous existences—or at least might have discovered from the evidence and preceding debates—legal aid is a pretty complex subject, which has significant and far-reaching implications for many areas of civil and criminal justice. There are many different views on how to tackle the concerns that have been expressed about the system. My own relatively recent introduction to the area has only made that extremely clear to me.
The legal aid fund is demand-led. The Scottish Legal Aid Board awards legal aid to everyone who qualifies under the scheme, and ministers have to find the necessary money to allow it to do so. There is no question of capping the legal aid budget, but that money needs to be found from the justice department's overall budget and ultimately from the Executive as a whole. As the committee knows, there are considerable pressures and competing demands on both budgets. As a result, Jim Wallace and I have to perform a difficult balancing act to ensure that adequate funds are available not just for legal aid but for other priority areas such as police, courts and prisons.
The answer to improving access to justice does not lie only in spending more on legal aid. There might well be a case for change in some areas. Along with SLAB and the Law Society of Scotland, we are currently considering a number of aspects of the system to find out whether improvements can be made. The committee's inquiry is therefore timeous and we will be very interested in its recommendations when it is completed.
Perhaps I should start with a general question. In your initial written submission to the committee, you said:
"The policy aims … are to ensure that the legal aid scheme is widely accessible and that it is delivered in an efficient and equitable way; and that the system … meets its overall purpose at a reasonable cost to the taxpayer."
Are those objectives being met?
In general terms, the system is working towards delivering those objectives. However, in my opening remarks, I said that anyone who examines the system will certainly agree that there are areas where we could improve its efficiency, effectiveness and fairness.
I asked that question because since 1993, when the lower income eligibility limit was lowered and the maximum contribution was increased, the number of applications has fallen by 36 per cent and there has been a reduced take-up of the offers made. An unbiased observer might conclude that legal aid was becoming less, not more, accessible.
That is a possible explanation of the difference, but there are others, some of which the committee has explored in previous evidence-taking sessions, particularly with SLAB. For example, there has been a change in the nature of litigation over the period you mentioned. There has been a huge 40 per cent decrease in fault-led divorce actions, which perhaps accounts for some of the applications that no longer happen.
Another change is the increasing number of people who have access to other means of covering legal costs, perhaps through insurance or trade union membership. That is perhaps more common now than it was 10 or 15 years ago. Although the connection implied in your question cannot be made, the issue bears examination, and SLAB is carrying out research to find out what lies behind the drop in applications.
What about the second statistic that I mentioned concerning the reduced take-up of offers made? Does that not indicate that the offers are perhaps not as generous as people first thought and that they are concerned that they will be landed with costs that they cannot afford, despite having some assistance?
That might explain why some of the cases are not pursued once the offer is made, but once again, there might be other explanations or reasons why people think better of pursuing their initial action. The required contribution being greater than expected is one—but not the only—explanation and that is one of the issues that SLAB is trying hard to ascertain, but it is not easy to find a full explanation.
I suppose that I should declare an interest as far as legal aid is concerned. I will ask about issues that have been raised with the committee and of which the minister will be aware from the evidence that we have received. For example, it has been suggested that there are inequalities of treatment in relation to eligibility criteria for advice and assistance and full civil legal aid. Although the working families tax credit is a so-called passporting benefit for advice and assistance, it counts as income in calculating eligibility for full legal aid. The Glasgow Bar Association highlighted the example of the woman on working families tax credit who automatically received advice and assistance, but had to meet a very large legal aid contribution. That situation is seen by some as anomalous to the point of unfairness.
The underlying problem is that the mechanisms by which social security benefits are taken into account for the purposes of assessing eligibility for legal aid are almost inevitably quite complex because the benefits system itself is quite complex. Secondly—and more avoidably—those mechanisms have probably been allowed to grow like Topsy instead of being considered in their fullness. That is because the benefits system changes. Mr Jackson provides a good example of that. I understand that family credit was previously a passporting benefit into advice and assistance, so when that benefit was changed to the working families tax credit the passporting aspect was carried over to maintain rather than to reduce eligibility. The effect has been significant; there has been something like a 40 per cent increase in eligibility because working families tax credit is more widely available than family credit.
Although Gordon Jackson has definitely raised an inconsistency, the issue needs to be examined in the round. For example, some benefits are contributory benefits and others are not. It is not necessarily logical for contributory benefits to be passporting benefits as it would be possible to have a very large income and still qualify for some other benefits. However, we accept that the matter needs to be examined.
Over the summer, we intend to review the impact of social security benefits on eligibility. If the question is whether we are concerned about it, the answer is yes. We intend to produce proposals to make the system more consistent. Clearly, we will bring those proposals to the committee so that it will be aware of our suggestions.
That links in with what I will say in a minute, but I want to move on for a moment.
The other inequality that has been mentioned concerns the areas of work. Some areas, such as social welfare and tribunals, are dealt with only through advice and assistance and do not receive full civil legal aid. However, the need for full civil legal aid—the amount of money that is required—might be as great in cases of advice and assistance as in any other. It has been suggested that the fact that certain things can be dealt with only through advice and assistance is a problem; that it is inevitable that the amount of time and resources that lawyers give to advice and assistance becomes restricted; and that advice and assistance gets downgraded in the eyes of lawyers, so they do not develop the same expertise. In other words, it has been suggested that it is inevitable that—even without cynicism—a two-tier approach develops in the legal profession. Lawyers will be more concerned about how well they do or how much work they do on one type of case than on another, because only one qualifies for legal aid. That is the problem that has been expressed to us. What is your view on that?
That would be unfortunate. Advice and assistance is an important and fundamental part of legal aid. The objective of legal aid is to provide access to justice. Advice and assistance helps deliver that objective because it provides access very quickly. The assessment of benefits and income, which decides whether someone is eligible for advice and assistance, is done in a way that keeps the process relatively straightforward. That means that the lawyer can make the assessment and then give the required advice and assistance without getting entangled in a complex financial calculation.
In our view, advice and assistance is not an inferior part of the legal aid system. Indeed, in the last year for which we have figures, something like 300,000 cases benefited from that kind of support. For people who use the legal aid system, advice and assistance is one of the most important parts. It would be unfortunate if lawyers took the view that you suggest.
I was not suggesting that advice and assistance is not important for lawyers, as I know only too well that it is. My point was about the amount of resources and time that lawyers put into advice and assistance, on which there are financial limits. The suggestion is that there is a basic inequality and injustice, because, for certain types of legal matters—which might be very important—lawyers can get only advice and assistance, which is limited, and cannot get the full civil legal aid. There is no rationale for that distinction. That was the point that was made to us.
The rationale concerns the level of legal advice that might reasonably be expected to be available for a type of case. Certainly, if there was an instance where advice and assistance was not delivering the level of assistance that the client required, and legal assistance was available only through advice and assistance, that would be a cause for concern.
I will come briefly to my other question. It has been suggested that the problem—you have more or less said this—is that the regulations have become so complex, with so many apparent inconsistencies, that we need a comprehensive review of them. The evidence that we were given by SLAB was pretty much along that line. You have made the point that, like Topsy, the thing just grew. Is there a case for consolidating—as lawyers say—and doing the whole thing again so that we can consider it from scratch?
There may be. I certainly agree that the regulations are extremely complex, although to a degree that is a reflection of the complexity of the legal system. There are all sorts of reasons for that—some good, some bad. New areas of law are being developed all the time and the system needs to keep up to date. I guess that we are as guilty as anyone else of causing that. The Adults with Incapacity (Scotland) Act 2000, for example, created new areas of law and made the system more complex.
I accept that we could rationalise elements of the system. Two fairly wide-ranging processes are under way that may inform this debate. The first is the committee's investigation and report, which is timeous. The second is the report of the community legal service working group, which has a wide-ranging remit to consider how legal advice and support is provided across the board—by solicitors and others. It would be proper for us to consider that report—which we expect in October—and the committee's report and then perhaps to revisit the question that Mr Jackson has posed. We can then consider whether what is required is tweaking or more fundamental changes.
The Scottish Legal Aid Board has said that a general review and rationalisation is needed, and that we need to redo the whole thing. The board's view, as the administrators, is significant and has influenced us. However, I accept the points that the minister makes.
Going off my script, last night I was at Kinning Park community council—
That is well off your script.
Indeed. The community council raised the issue of legal aid being made available to groups such as themselves. The community council often has huge planning problems in its area. The applicant for planning permission may be a big battalion and the local group may feel overpowered. The community council wondered whether there were proposals to allow legal aid in such cases. As you are here, I thought that I would ask you.
I am aware of this issue. In my constituency, the main reason for the existence of a number of community councils is to engage in the planning process. Their members live in parts of Edinburgh where the green belt is under constant pressure from developers. On occasion, they have been involved in actions. That can be expensive if you take into account the work that professionals have had to do or that retired professionals have had to do.
A specific case right next to my constituency is that of Kirknewton community council, which raised an action against the City of Edinburgh Council relating to the council's administration of its planning regulations in the case of a landfill site that is in my constituency but is next to the boundary. The community council incurred legal costs to the tune of £6,000 or £7,000. It perceives an unfairness in standing against developers who can afford the best legal advice available. I say that as an expression of sympathy and understanding.
At the moment, legal aid is not available for community councils; nor is it generally available for planning matters, except for actions in the sheriff court or the Court of Session. It may be worth considering the issue in the review of community legal services. Local authorities may have a role, because they are required to support community councils in their areas. I would be interested to know whether local authorities could be empowered to provide those sorts of resources or whether they are not allowed to do so. Perhaps I should ask my officials to look into that and get back to Mr Jackson.
I would appreciate that, because I had not considered that angle.
This point comes back to some of the minister's comments to Gordon Jackson. Evidence that the committee has heard has indicated considerable concern about the way in which the legal aid budget seems to be heavily biased towards criminal as opposed to civil matters. I understand that the split is 60:40. It is also interesting that we have heard evidence that expenditure on legal aid in England and Wales is more evenly split between civil and criminal matters. What is the Executive's view of why that split has arisen, and what could be done to redress the balance?
That takes us back to the convener's initial question. As we said, the legal aid budget is not capped—it is demand-led—so the level of civil and legal aid costs to some extent is a function of applications and eligibility. I do not know if the 60:40 split that you describe represents a change over time, but if it does, it takes us back to questions about the reduced number of applications for civil legal aid.
Almost certainly the large increases in the cost of criminal legal aid cases over the period up to the introduction of fixed fees contributed to the shift towards criminal legal aid. Fixed-fees payments have brought that under control and flattened off the increase. With regard to what can be done to redress the balance, fixed fees are the most significant factor. Some of the answers to the first part of your question may be found in the work that SLAB is doing to ascertain why there has been a reduction in applications for civil legal aid.
You stated in your opening comments that there is no question of capping the legal aid budget. We have had evidence that while the budget may not be capped, the eligibility criteria have been altered, which indirectly restricts access to some forms of legal aid, and may in particular have affected access to civil legal aid. What is your view?
The example that we discussed was the working families tax credit, which is a passporting benefit that extended eligibility. I have to ask you to provide an example of what you mean.
For example, the uprating of solicitors' and advocates' fees has not occurred, which has been a way of capping the budget. That does not mean that someone will not be provided with legal aid, but it has restricted access. We have been given evidence that some solicitors have decided not to take on certain cases, and that there are difficulties in recruiting staff to work in legal aid practice. The service may not have been restricted in terms of the types of cases that are eligible, but it has been restricted in terms of those who are willing to take on cases and in attracting staff to the sector.
I was going to say that your question confuses two different things, but that would be unfair. Your question counterpoises two different things. If the legal aid budget was capped, there would be a limit above which it could not go. Presumably, if that ceiling was reached, no legal aid would be available. I think it was Professor Paterson who gave the example of Australia, where there are capped legal aid budgets—that is how the system operates there. Come the time in the year when the budget is spent, there are no more cases until the new financial year.
There is no question of our legal aid budget being capped in that way. However, to say that the legal aid budget is not capped is not to say that the Executive and SLAB do not have some responsibility to control the budget. That is a different thing, and is entirely reasonable. It would be inappropriate for the budget not to be controlled. The fees that are paid to solicitors or counsel are one aspect of that. The committee is well aware that solicitor fees have not changed for almost 10 years in some cases—or perhaps since 1992 or 1993—and there is mitigating evidence concerning the effect of that. For example, although fees have remained static, the average cost of a case has risen steadily over the years, presumably on the basis of the amount of work that has been put into the case. It is reasonable that that should be addressed.
The issue of solicitors' fees will be addressed by the tripartite group—the Law Society of Scotland, SLAB and the Executive—which is already discussing whether and by how much fees should be uprated. It is probably right that they should be, but I would place two caveats on that. First, that must be done in the full knowledge that if the group increases what we have to spend on legal aid, the money will have to come from somewhere else in the justice department's budget. Those resources will then be unavailable for other changes that we might want to make. Secondly, such a significant change after a long period of time ought to be considered as part of a package to address other issues such as quality assurance in service provision. We understand that the Faculty of Advocates is preparing a case regarding fees to counsel, but we have not yet received any information from it.
Minister, prior to your arrival we took evidence from Mr Hamilton of the Legal Services Commission. He gave us a comprehensive insight into the workings of the commission in England and Wales. What is your view on the possibility of such a commission being introduced in Scotland?
We can learn from the experience in England and Wales. The Legal Services Commission has taken a simpler and different approach from that which is taken in Scotland, as it has gone down the road of franchising to ensure that services and outlets are in place for providing the legal advice that is required. I am not averse to examining the possibility of pursuing a similar approach, but it would be improper to say that we believe that that is necessary while the community legal services working group is examining how we can ensure the delivery of a whole range of advice and assistance that people require throughout Scotland. That group will consider alternative models that are already on the ground, based on partnership and building on local authority and community provision as well as solicitor-provided services, and how to strengthen those.
Once we have received the working group's report, and once the committee's deliberations are completed, we will be faced with the question of whether we want to try to improve the system that we have, make some changes or go for something more like a fundamental review. At that point, we might want to consider the experience in England and Wales and decide whether to follow that model.
The Scottish Legal Aid Board already seems to have some of the powers that the Legal Services Commission has, or it could be given them. That would be an alternative approach to setting up a new body. In its evidence to the committee, SLAB expressed a desire for more strategic powers, and that would be an alternative model. However, the CLS working group should inform us of what it regards as the appropriate solution for Scotland.
Setting aside those issues, what do you think would be the advantages and disadvantages of such a commission?
An advantage that the commission has, which our system does not have at the moment, is that it is able to be proactive in ensuring that provision is made available on the ground, either in a geographical area where it feels that it is lacking or in a specialist area where it is lacking. Those concerns must be addressed in Scotland, and the CLS working group should be addressing them. It remains to be seen whether the group will come back with an alternative way of meeting those needs when it reports to us.
How would you divide the responsibility between the ministers and such a commission, if one were set up?
That is a hypothetical question. Ministers have responsibility for setting the budget and for deciding such matters as eligibility criteria, although they should take account of advice from the board or the commission.
You talked about having to make a decision only after the working group on community legal services has reported. What time scale do you envisage for the making of that decision?
We expect to receive that report in October, and we will need to consider our response to it very quickly. There is a great deal of interest in its work on the ground, which may read across into other work that is being undertaken in the Executive—for example, consideration of the management of debt in the poindings and warrant sales working group. That may put some kind of time pressure on it. If the CLS working group's report and the committee's report led us to believe that we needed to make significant change, that would almost certainly require legislative change, and I would not be able to say where such change would be possible in the legislative programme.
Some witnesses have expressed concern that the resources to establish a community legal service would be provided at the expense of services elsewhere. I know that that is a hypothetical concern, but is the Executive committed to finding extra funding if it is required, or is some other budget going to be raided?
Some of my earlier remarks implied that, whatever we do, another budget would have to be raided, although it might be a hypothetical budget for something that was not already in place. If we make changes to the system—even if those changes are not the radical ones that we are talking about, there will be some following the CLS working group's report—it will be incumbent on us to try to find the funds to ensure that another part of the service is not disabled.
In all fairness, we are talking about a system to provide access to justice in a broader sense than was envisaged when the legal aid system was set up. Costs and budgets will have to be considered in that broad sense, and there may have to be a rebalancing of resources within that framework. It is hard to imagine those changes taking place without some additional resource being made available.
I am sure that you agree that, in trying to deliver equity in access to the law, eligibility must be considered. In 1993, eligibility was cut. You spoke to Gordon Jackson about a small group of people taking action against a council or big business. Equity is not possible without some form of funding for the weaker party. Concern has often been expressed that it is only the very poor or very rich who can take or defend civil actions, and that the rest of the population cannot afford to do so. Do you think that the CLS working group will address that? It seems to be considering other areas that currently lack representation, but not to be concentrating on what many people think is the crucial fact that only the very poor or the very rich can afford it.
I expect the CLS working group to have something to say about eligibility, as well as about different methods of providing access to justice. There could be any amount of debate about where the eligibility criteria lie, but it is difficult for me to imagine our being able to create a situation in which it could not be argued that access was available for the lower-income client and for the very high income client, but that the middle-income client was missed out. It seems to come down to a debate about where we put the dividing line.
Given that we are discussing an application of public funds, I think that there will always be a test of whether it is reasonable for legal aid to be applied. Somebody who is very rich and is funding an action from their own funds will, I guess, always have the opportunity to proceed with their action in the face of however much advice they are given, even if that advice is pointless or unreasonable. That situation will never be replicated under a legal aid system: to allow that would not be a proper use of public funds. The argument or discussion about this will always come down to where the income levels for eligibility lie.
It has been suggested that the distinct advantage of being granted civil legal aid, even in cases in which people must make a significant contribution, is that that provides protection against liability for the other party's costs should the legal-aided party be unsuccessful. That protection also extends to the legal aid fund, in that the successful unaided party will not usually be allowed to recover costs from the Legal Aid Board. Is that arrangement equitable, given that, in a civil case between two parties, neither of whom receives legal aid, the successful party is usually granted an award of costs against the unsuccessful party? Some people have even suggested that a grant of legal aid is a powerful weapon against an unaided party.
I understand that concern about that has been expressed during evidence to the committee. There is provision in the Legal Aid (Scotland) Act 1986 for the court to award costs against the legal aid fund. That has been done to the extent of £36,000 over the past year, so the provision is clearly not often used.
There are some tests: that expenses can be awarded in such a case; that the proceedings are held in the court of first instance; that it is the assisted person who raised the action; and that the person who does not receive assistance would suffer severe financial hardship if obliged to pay. In other words, if the action was launched by somebody who was supported by legal aid, that should not result in the other party—should the supported person win—suffering severe financial hardship.
It seems from the research that I have done in preparation for today's meeting that solicitors do not often use that procedure, but I cannot give members an explanation now as to why that should be. One thing that makes it difficult is that there is no way of telling how many applications were refused by the court. It might be that solicitors use the procedure, but the courts refuse. It is something about which I would like to find out more.
I understand that the Legal Aid Board has plans to draw solicitors' attention to those provisions in the Legal Aid (Scotland) Act 1986. It might be that the injustice is in the application of the system or of the legislation, rather than in the legislation itself.
I seek clarification of the Executive's position on victims of domestic violence and on the urgency provisions for legal aid. A number of witnesses have told the committee about the particular problems that arise in relation to obtaining legal aid speedily for the protection of victims of domestic abuse. In particular, there is the issue of the notional contribution and special urgency cases, which are mentioned in paragraphs 27 and 28 of the justice department's note. Is the Executive any further forward in its consideration of those matters?
There might be two different issues underlying that question—if I have misunderstood it, I ask Maureen Macmillan to come back to me. The first point is to recognise the fact that urgent legal aid is available and is widely used. In the past year, 15,500 such awards were made, so the process is both known and used.
One of the problems with the contribution is that lawyers will sometimes ask for it to be paid up front. My understanding is that that tends to be because of their experience in the past—they would certainly explain it in this way—of having begun the process but then finding it impossible to recover the contribution. Their way of protecting themselves is to ask for the money up front.
I can see the lawyers' side of the issue; equally, I can see the other side, and the issues that Maureen Macmillan raises could indeed put somebody off taking the legal action that they ought to take. We are talking to SLAB about the matter, and we are conscious that the committee is discussing it. I do not have a clever answer to the problem, but if the committee has any suggestions that are fair and equitable, we would be very interested to consider them.
We will do our best.
On abuse, when we published the financial memorandum of the Protection from Abuse (Scotland) Bill, which is this committee's bill, Jim Wallace wrote to me, expressing concern about the
"potential public expenditure cost of the Bill's provisions".
He suggested that that might limit any financial scope for the Executive to be able to respond positively to any recommendations that have expenditure implications that could emerge from this inquiry. Could you expand on that?
I have made the point on a number of occasions that, although the legal aid budget is not capped, the expenditure in it has to be found in the first instance from within the justice department. The position that Jim Wallace was trying to express was that the Executive is very supportive of the bill in principle, but that there is an obligation on our part to ensure that that support is subject to a requirement for affordability, and there would be some costs. Our estimate is that the costs of the bill as introduced might be £2 million a year. We are very supportive of the bill, but we encourage the committee to consider issues of affordability as part of its inquiry on the bill. Does that answer your question, convener, or were you asking specifically about the financial memorandum?
I was concerned about your implication that, if the bill were passed as introduced, that would constrain our ability to reform other aspects of the system or to expand legal aid provision elsewhere. I presume that that is the implication.
That seems, to an extent, to be a statement of fact. If there are additional costs attached to the implementation of the legislation, those costs will have to be met from within the justice department budget in the first instance, which will have an impact on budgets elsewhere.
But not necessarily on the legal aid budget, given that it is demand-led.
It will impact on that budget, but the costs are not just legal aid costs—there are also costs within the court system.
It is correct to say that the fact that the legal aid budget is not capped means that someone who availed themselves of legal aid under the terms of this bill would not be preventing someone else from accessing legal aid.
The proposals might save money, because people would be taken to court for breach of interdict rather than for serious assault. I am not convinced that the process would cost more.
One must always have regard for the costs of the legislation to the budget. Our opinion is that the cost of the bill as it stands would be about £2 million a year.
And worth every penny.
As Maureen Macmillan said, if a policeman can arrest somebody on the spot, rather than spending an enormous amount of time dealing with a situation in which the police do not have powers of arrest, there would be a great saving in police time. However, that would not be reflected directly in the department's budget, although the legal aid costs would be.
That is correct.
I want to talk about something else that will impact on your budget, minister. Earlier, you commented on the length of time that has passed since fees for legally aided work were uprated. Concern has been expressed that fee levels are a disincentive to the undertaking of civil and criminal legal aid work. There might have been an exodus of practitioners from legal aid work and it has been indicated to the committee that low fee levels make it hard to take on trainees. Is your department concerned about that?
We would be concerned about it if it meant that the quality and the availability of advice were reduced. In answer to Michael Matheson, I dealt briefly with the fact that solicitors' fees are under consideration by the tripartite group and that we expect that the Faculty of Advocates will submit proposals to us in the near future about changes to fees for counsel. We have acknowledged that almost 10 years is a long time for those fees to have remained unchanged.
We are concerned about the issue of the impact that that might have had on the availability of advice or the willingness of solicitors to do legal aid work, but we remain unconvinced that that is happening. Most of the evidence that I have seen presented in various fora, including the committee's evidence-taking sessions, seems to be anecdotal. I have seen no rigorously made case. Some of the evidence that was given to the committee was not to the effect that that happens, but that there exists the potential for it to happen soon. As with some other questions with which we have dealt, that remains hypothetical. Nevertheless, we accept that the time has come when we must consider the fees.
I made the point to Mr Matheson that we must consider that change as part of a package. My personal view—I am not part of the negotiations in the tripartite group—is that we need to ensure that the service that is being paid for by public funds is of the quality that we should expect. That might go some way towards addressing the anecdotal evidence that states that only junior solicitors are willing to undertake legal aid work and that only junior counsel are willing to undertake criminal legal aid work.
Witnesses have expressed concern about the impact of fixed fees on summary criminal cases. It is suggested that there are two possible outcomes of a fixed-fee system. One is that the service that is provided will be tailored to the level of the fee. The other is that lawyers will provide the service that is required, thereby effectively subsidising the legal aid budget. Neither of those outcomes is satisfactory. Is that a fair analysis?
No, I do not think that that is a fair analysis. When fixed fees were introduced, there were all kinds of warnings about what would happen. I do not pretend to be a regular reader of The Scots Law Times, but I believe that it described the scheme as
"devised by Satan and manufactured in hell".
That is a little strong. Our experience is that fixed fees seem be working. About 90 per cent of criminal legal aid cases were taken under fixed fees in the past full year. Fixed fees have also had an impact on bringing expenditure on criminal cases under control, although there are signs that reductions in spending have bottomed out and that spending is beginning to increase again.
The scheme has some advantages for solicitors—for example, it provides assured and quick payment, which has not always been the case. About 120,000 cases have been handled under the scheme; therefore, we now have quite a lot of experience of such work. The scheme has been in operation long enough for proper research to be done into how well it is working. I think that that research will show that the fixed-payment scheme is working and that the analysis that you have put to me is incorrect.
One caveat is that the Convention Rights Compliance (Scotland) Bill exempts complex cases. If there was a weakness in the scheme, it was that it did not allow for that. We have now acted and dealt with the most severe difficulty with the scheme.
On how the department has monitored the impact of fixed fees, you seem to be saying that whatever has been done up until now, you are seriously considering more research.
We intend to commission a proper and detailed research project into the impact of the scheme and we will evaluate that research when we have it.
As committee members have no further questions, I thank the minister and his officials. I do not anticipate asking to give you further oral evidence, but we might write to you on one or two points.