MoJ’s increase of just two duty provider contracts is a ‘slap in the face’ for legal aid lawyers

The Ministry of Justice (MoJ) has announced it will push through with its hotly contested cuts to criminal legal aid, despite warnings from the profession that such cuts will lead to chaos and denial of access to justice, as well as the closure of two thirds of solicitor firms.

In what was a depressing day for the legal profession, the MoJ published its response to its Transforming Legal Aid: Crime Duty Contracts consultation. Its decision has been to increase the number of tender duty provider contracts to 527; just two more than was originally proposed in February.

The MoJ state that the consultation received 3,942 responses mostly from legal aid providers who, it says, provided no new evidence requiring it to increase the number of contracts further. The government also plans to push ahead with two-tier contracts for criminal legal aid and implement a second fee reduction of up to 8.75 per cent next year.

‘Careful review’

In his foreword to the consultation response, the Lord Chancellor and justice secretary, Chris Grayling, said: “The most recent consultation exercise has enabled me to consider afresh the number of duty contracts that we make available. Having reviewed the evidence carefully, there will now be 527 contracts, a small increase from the number originally proposed.

“I think it is important to point out that although the number of contracts will be limited to 527, I am keen there is real scope for a diverse market, with a larger number of firms working together in partnerships and joint ventures, benefiting from economies of scale, delivering a quality service in their local communities.”

Grayling added: “Given we expect the total volume of work to remain constant, I do not foresee a significant change to the number of litigators practising in this area, even if the structure of the market looks different than it does today.”

The consultation began after the high court ruled the MoJ had acted unlawfully when introducing the government’s reforms. The London Criminal Courts Solicitors’ Association (LCCSA) and the Criminal Law Solicitors’ Association (CLSA) brought a judicial review that focused on reports by accountants KPMG and Otterburn, which had provided the foundation for deciding how many contracts would be available.

Many respondents to the consultation cited the controversial Otterburn report, which stated that only the most profitable legal aid practices would survive under the new model with a 17.5 per cent cut in fees.

However, this was rejected by the MoJ who argued the report was ‘in the context of the current unconsolidated market’, and that ‘consolidation of the market will give organisations the opportunity to access a larger share of work, enabling them to explore economies of scale which will in turn help to mitigate the fee reduction and give them the best possible opportunity to make a sustainable profit’.

‘Greater flexibility’

It will be of little solace to criminal practitioners the length and breadth of the country that the government also announced it will pay expenses for travel time over 90 minutes to help firms in rural areas and that it will relax the office requirements in the split procurement areas and London to “give greater flexibility”.

“This builds on the support measures introduced earlier, such as introducing interim payments for lawyers involved in lengthy Crown Court cases and establishing a business partnering network to help practitioners with organisational and financial advice, if they need it. We have also worked with the British Business Bank to develop guidance and advice specifically for the legal aid market”, added Grayling.

The Lord Chancellor concluded by saying he “recognises there are challenges ahead as the market reorganises to adjust to reduced fee levels and new contracts. However, I believe those changes are necessary for the sustainability of the market, in constrained economic times”.

An MoJ spokesperson added: “Nothing will change for anyone accused of a crime, they will still have the same access to a legally aided lawyer as they do now.”

‘Pathetic response’

Shadow justice minister Andy Slaughter condemned the “pathetic” consultation response, describing it as “another slap in the face” to legal aid lawyers. “This does very little to fix the growing crisis in legal aid and only further highlights how this out of touch government are belligerently sticking to their already failing program. Cuts to legal aid have led to justice increasingly becoming a privilege for the wealthy few,” he said.

Also commenting on the news, president of the LCCSA, Jon Black, said: “This is a really depressing day. The MoJ has shown that it’s hell-bent on forcing through these cuts whatever the warnings, whatever the price to society and justice. Civil courts are imploding under the strain of legal aid cuts. The criminal courts are going the same way. By the time the public is really aware of the effects of his attack on our criminal justice, it will be too late.

“This carve up of solicitor contracts in police stations and magistrates’ courts, combined with yet more cuts will cause terrible collateral damage. A fair defence for those who aren’t wealthy will become a lottery. As firms start to close or cut corners to keep afloat we’ll see plummeting standards of defence and miscarriages of justice. It would seem that the government is unconcerned by this. But no-one should be hoodwinked, it’s too high a price to pay.”

Meanwhile, Law Society president Andrew Caplen expressed his disappoint at the announcement: “In our view the scheme fails to meet the ministry’s own objectives of ensuring that criminal legal aid must be sustainable with enough solicitors doing criminal duty work.

“Some areas of the country could be left with no legal representation for anyone accused of a crime, depriving vulnerable members of the public from access to justice. We are very concerned that the ministry has not taken into account the views of the overwhelming majority of our members who responded to the consultation, or to the independent consultants who raised concerns about the economic impact on the supplier base.”

Caplen added: “Our priority now is to do whatever we can for our members. We are arranging meetings with practitioner groups as soon as possible to discuss the next steps.”

Practitioner reaction

A statement issued by the Criminal Bar Association reads: “The changes made pursuant to the consultation are trivial and do not address the problems inherent in the proposals. The government continues to rely on unreliable assumptions and has ignored the evidence and informed expert opinion.

“We have repeatedly warned government that the CBA believes that the implementation of this scheme will cause serious and irreversible damage to the criminal justice system. We intend to consult widely with the solicitors’ profession and their representative bodies before considering any further response.”

Chairman of the Bar Council, Nicholas Lavender QC, also weighed in: “We said that the Otterburn and KPMG reports provided strong support for the conclusion that adopting the dual contracting model proposed by the government would run a substantial, but unnecessary and unjustified, risk of causing significant harm to the criminal justice system. It is disappointing that the government has decided to press ahead with that model.

“The Bar Council said the proposed changes would result in a massive and irreversible dislocation in the market for criminal litigators, for no obvious benefit. Many would not be willing or able to enter into the new contracts. There is also a risk that those who obtained contracts would not find them viable and would go out of business.

He continued: “Consequently, there would be a risk that in some areas of the country there will be too few firms able to enter into, or remain in, the new contracts, leaving defendants with insufficient lawyers to advise them in police stations or represent them in the Magistrates’ Courts.”

Practitioners also joined in the condemnation on social media. Solicitor and journalist David Allen Green tweeted: “MoJ found to have acted illegally in legal aid consultation. MoJ then pays lip-service to consultation and makes same decision, legally.”

9 Bedford Row barrister and chairman of the Young Barristers’ Committee of the Bar Council, Max Hardy, posted: “What MoJ is doing to the solicitors’ profession is a disgrace that hurts them, the public and justice. It’s no consolation for them but the whole tendering exercise will be a catastrophic failure that will make interpreter shambles seem child’s play. Status quo will resume but how many good, honest, decent and diligent solicitors and firms will be forced out of business?”

Fresh invitations to tenders for the duty contracts run from 27 November 2014 until 29 January 2015. Services under both new contracts will start on 1 October 2015. Firms bidding for contracts as new entities have been advised to contact the SRA about authorisation as soon as possible.

SRA Chief Executive, Paul Philip, said: “We do not at this stage know exactly how many firms may need authorisation from us as part of their bid, so it makes sense for them to get in touch sooner rather than later. We are aware that the MoJ has contacted those firms in the bidding process to highlight the need to get in touch with us.”

This article was first published in the Solicitors Journal on 28 November 2014 and is reproduced with kind permission.