A further criminal legal aid fee cut would be fatal for many firms already hit by lower volumes of work
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Administrator
It still feels startling to recall that just under a year ago, the government capitulated in its battle with criminal legal aid firms to introduce the dual contracts system, which would have reduced the number of firms undertaking duty contracts by two-thirds. In the same announcement, the then justice secretary, Michael Gove, confirmed that the Ministry of Justice (MoJ) would suspend a fee cut of 8.75 per cent for a year from April 2016. With the clock now ticking down to this deadline, will Gove’s successor, Liz Truss, go ahead with the cut and risk a showdown with criminal legal aid lawyers?
Gove’s U-turn
Gove’s appointment as justice secretary after the general election in May 2015 had led to a change of tone at the MoJ. Practitioner groups reported to Legal Action that he was much more prepared to listen to their concerns about the likely impact of the duty tenders and planned further fee cut. It turned out that practitioners’ optimism about the new boss at the MoJ had not been misplaced when he announced the policy U-turn on 28 January 2016.
In his written statement to the House of Commons (Hansard HC Debates Vol 605 cols 15WS–18WS, 28 January 2016), Gove explained that he was able to make the concessions due to two main reasons:
First, thanks to economies I have made elsewhere in my department, HM Treasury have given me a settlement which allows me greater flexibility in the allocation of funds for legal aid.
Secondly, it has become clear, following legal challenges mounted against our procurement process, that there are real problems in pressing ahead as initially proposed.
He went on to explain that he did not want the MoJ and the legal aid market to face years of uncertainty due to the pending litigation.
Change at the MoJ
Due to his Machiavellian tactics in the aftermath of the Brexit vote, Gove went from a potential prime minister to being sacked as justice secretary in a matter of days. His replacement, Liz Truss, has so far stuck to the plans of her predecessor and not raided the legal aid budget to find cash in the current round of cuts, but the threat of a reduction in fees has not been withdrawn.
Zoe Gascoyne, chair of the Criminal Law Solicitors’ Association, warned that if the fee reduction is introduced, ‘there will be an extremely strong reaction by practitioners’. She pointed out that ‘the MoJ’s own experts had made it clear that the profession could not sustain the second 8.75 per cent cut’. One of the authors of the research to which she was referring, Vicky Ling, who is also a co-editor of the LAG Legal Aid Handbook 2015/16, said that ‘many firms are very nervous about a second fee cut’, as if it were to happen, it would not be viable for them to continue.
In an earlier climbdown, the MoJ had decided to delay a six per cent cut to advocacy fees. A boycott action in which the Bar had refused to take cases at short notice (the practice known as returns) had forced the government’s hand in March 2014. Phil Robertson, director of policy at the Bar Council, believes the government’s commitment made then ‘still holds good’. The Bar Council has been talking to the MoJ ‘for some time now’, he said, speaking about redrafting the Advocates’ Graduated Fee Scheme ‘on a cost-neutral basis’. Legal Action feels it unlikely that the government would risk another confrontation with the Bar over fees. Advocacy fee changes also have the additional complication of having to go through parliament to be approved.
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Protest against legal aid cuts organised by the Justice Alliance at Runnymede in February 2015
Photo: LAG
Rising costs
There has been an increase in the cost of police station and magistrates’ court cases, or ‘crime lower’ as they are referred to by the Legal Aid Agency (LAA). This has been reported for the quarter April–June 2016 (Legal aid statistics in England and Wales April to June 2016, MoJ/LAA, 29 September 2016, page 10) despite the continued decline in the overall number of cases. The MoJ attributes the five per cent increase in cost compared with the previous quarter to Gove’s decision to rescind the 8.75 per cent fee cut. Legal Action would stress that the MoJ should not use this as justification to reintroduce it, as the overall trend is still down, with a six per cent fall in expenditure on crime lower compared with the same period the previous year.
Ling believes one of the main worries for firms is the lack of work. The only way many are surviving, she explained, is by ‘doing large volumes of crime lower cases and getting a few big cases that pay’. In the financial year 2014/15, there were a total of 1,130,000 crime lower cases (Legal aid statistics in England and Wales January to March 2015, 25 June 2015, page 9); that number fell to 1,033,000 (Legal aid statistics in England and Wales January to March 2016, 30 June 2016, page 10) in the financial year 2015/16. Legal Action fears that a further fee cut combined with the falling volumes of work could have much the same effect over time as dual contracting would have had but for Gove’s welcome U-turn.

About the author(s)

Description: Steve Hynes
Steve Hynes is a freelance consultant and writer. He was previously director of LAG. He is a well-known commentator in the written and broadcast media...