Costs auditsFinancial and contract managementCosts auditsContract managementFinancial and contract managementCosts auditsContract managementFinancial and contract managementCosts auditsContract managementFinancial and contract managementCosts auditsContract managementFinancial and contract managementCosts auditsContract managementFinancial and contract managementCosts auditsContract managementFinancial and contract managementCosts audits:evidence of meansCosts auditsContract managementFinancial and contract managementCosts audits:family level 1 and 2 feesCosts auditsContract managementFinancial and contract managementCosts audits:family level 1 and 2 feesCosts auditsContract managementFinancial and contract managementCosts audits:family level 1 and 2 feesCosts auditsContract managementFinancial and contract managementCosts audits:family level 1 and 2 feesCosts auditsContract managementFinancial and contract managementCosts audits:crime criteriaCosts auditsContract management
20.21Historically, cost auditing of controlled work has always been a bone of contention between the LAA and practitioners. Practitioners tend to feel that LAA staff do not understand the work that has been done and the LAA tends to feel that practitioners are not sufficiently stringent in applying the Contract requirements. The LAA has published a list of 14 different types of audit and validation process.
1See www.gov.uk/legal-aid-agency-audits.20.22The LAA’s approach is that if, from the management information evidence that they have, it appears that you are complying with contractual requirements, it is likely that you will only have one contract manager visit a year and will not be audited further. The LAA distinguishes between a contract manager visit, which it does not count as a formal audit, and formal audits, carried out by members of the Operational Assurance team. The distinction is lost on many practitioners, who often emerge from whichever process the LAA has used having to repay money. The way to avoid this is by robust supervision and monitoring, especially before final claims for payment are submitted. To ensure all your claims are made correctly, the LAA’s Costs Guidance is helpful and can be found here
www.gov.uk/funding-and-costs-assessment-for-civil-and-crime-matters.
20.23The LAA’s audits are undertaken to provide the Ministry of Justice with assurance that the legal aid fund has been spent correctly and to eliminate the cause of irregularities and errors identified in the past by the National Audit Office, which led to the LSC’s annual accounts being qualified towards the end of its life. The LAA needs to achieve an overall level of ‘materiality of error’ of less than one per cent in order to meet NAO targets.
20.24This means that in the small samples taken by contract managers when they come to visit, you are aiming for a 0% error rate. This is not easy!
20.25The main problem areas are in controlled work (Legal Help, Controlled Legal Representation and Family Help Lower) cases:
•assessing the eligibility of clients incorrectly or retaining insufficient evidence on file; and
•incorrect claims for payment for:
•private law family cases; and
•immigration and asylum cases
So, these tend to be the main focus of visits/audits in civil and family categories (see below for crime). In 2016 the LAA issued very helpful guidance called ‘Preventing Audit Issues’, which aims to help practitioners avoid the most common types of error.
2See www.gov.uk/legal-aid-agency-audits.20.26If you disagree with an LAA decision about costs, see costs appeals, para 20.45 below.
Evidence of means
20.27The contract manager will select at least five Legal Help Forms. If even one of them fails, (egdue to no or invalid evidence of means) a further sample will be selected. This is then audited by the organisation itself and two files are checked by the contract manager. If three or more of the aggregated sample fail, the organisation may be invited to agree an extrapolation rate across all similar work, or may be asked to self-assess all the files which could possibly exhibit the same failing.
Family level 1 and 2 fees
20.28The contract manager will be checking that level 2 fees have been claimed correctly, see below.
Private Family Law – conditions for level 2
20.29Up to and including 08 May 2011, paragraph 10.55 of the Family Contract Specification required two meetings with the client in order to justify a level 2 fee.
20.30Note also that following certification of PoP CLA 54 – definition of ‘meeting’ was broadened from 20 December 2010 to include phone calls.
20.31The LSC removed the requirement for a second meeting from 9 May 2011 and instead practitioners had to show that ‘substantive negotiations’ had taken place. This remains the position under the 2013 Standard Contract.
Standard Contract 2013 Specification
7.60 You may only make a determination that a Client qualifies for Family Help (Lower) where all relevant criteria in the Merits Regulations, Financial Regulations and Procedure Regulations are satisfied including the criteria in Paragraph 35 of the Merits Regulations. In addition, the fee for Family Help (Lower) may only be claimed for those Family Disputes:
(a)which involve more than simply taking instructions from and advising the Client, and providing any follow up written or telephone advice; and
(b)where you are involved in substantive negotiations with a third party (either by conducting the negotiations yourself or by advice and assistance in support of mediation); and
(c)where the dispute, if unresolved, would be likely to lead to family proceedings; and
(d)which do not primarily concern processing a divorce, nullity, judicial separation or dissolution of a civil partnership; and
(e)which do not primarily concern advice relating to child support.
Crime
20.32In crime, contract managers will check:
•evidence of means on CRM1 and 2 cases;
•incorrect claiming of court duty work:
•claiming under a subsequent representation order as well as court duty for the same case;
•claiming under a representation order when the case concluded on the same day as a court duty session;
•incorrect claiming of travel for court duty work;
•‘duplicate’ claims where more than one police station case fee has been claimed, where the contract manager considers that there was a ‘series of offences’ and only one fee was payable.