Guy Beringer CBE KC (Hon) sets out his proposals for reforming civil legal aid provision.1This paper was first published on Joshua Rozenberg’s website. Executive summary
The problem
The effective provision of social welfare legal help and representation requires a properly resourced set of organisations capable of delivering such help and representation where and when it is needed. Civil legal aid is driven by complex eligibility and procurement rules that produce unsustainable economic friction costs for any organisation that tries to deliver help and representation to the public. This has caused the provider base to shrink and there is no plan for rebuilding it. Without a provider base, there will be no delivery of help and representation to those who need it.
The solution
The focus of legal aid should be the creation of a growing, high-quality provider base. The current focus on bureaucratic assessment of procurement performance should be scrapped.
Removal of the friction costs caused by legal aid administration would provide additional funding to the provider base of at least £50m per annum without any additional call on government funds. The legal aid fund should be treated as an economic growth fund and the provider base should be treated as a growth SME sector.
The civil legal aid scheme should be judged against its success in:
•enabling users to become economically active;
•growing an economically sound SME provider base; and
•making savings in other departmental budgets (including health, housing, social care and criminal justice).
A new policy approach – economics not procurement
Policy should be shaped by three new principles for civil legal aid.
1Funding should be provided to meet the costs of delivery organisations and not attached to individual cases. Delivery organisations should be left to assess eligibility themselves without central input. Decisions on how to apply funding should be taken by providers.
2Funding of providers should be made in advance and not in arrears. Working capital funding for SMEs cannot be provided in arrears as they have insufficient capital on which to draw. The performance of providers should be assessed by reference to the outcomes they achieve for citizens and the communities they serve. The current assessment of matter starts, time spent, central response times or other internal metrics of the Legal Aid Agency (LAA) should be scrapped.
3The civil legal aid fund should be administered regionally and in collaboration with other linked funding regional sources (including health, homelessness, social care and education).
The rationale for each of these principles is as follows:
1. Fund delivery organisations: stop counting cases
In the last year, the LAA processed over 350,000 applications for legal aid and over 1.25m bills (covering civil and criminal). This is a waste of time and money on the civil legal aid side because no meaningful effort is made to assess whether the cases improved the lives or economic wellbeing of the citizens or communities concerned.
The key performance indicators (KPIs) and headline performance summaries of the LAA are set out in its annual report. They are almost entirely self-referential and relate to its own efficiency in dealing with administrative tasks. The annual report says very little about outcomes or benefits arising for members of the public from its work.
The LAA risk report has a single reference to ‘[g]aps in the provision of legal aid due to insufficient provider volumes’. The number of civil legal aid providers has dropped steadily by over 20 per cent in the last four years. The drop has not been caused by consolidation but is a drop in real capacity. This has been a live problem for years and is not mentioned in the LAA KPIs.
The key to quality provision of help and representation lies in sustainable providers who can invest in the following aspects of their businesses:
•infrastructure (IT and case management);
•knowledge management;
•staff recruitment and training; and
•identifying and adopting best practice.
These are the factors which will determine outcomes for clients. Funding should therefore be directed at them as they are the only reliable proxies for value for money for a funder.
There are almost 1,500 organisations providing legally aided services, split between the private sector and the third sector. They are almost all SMEs. They provide one of the most accessible and easily influenced groups of SMEs in the economy.
This provider community should be regarded as a potential source of new jobs, economic growth and local prosperity in addition to being regarded as providers of state-funded legal help and representation. The focus should therefore be on funding provider organisations and not on paying for cases. The sustainability and quality of those organisations should be the key metric in assessing value to the public.
2. Provide funding in advance
The current system of micromanagement of eligibility and payment in arrears severely penalises the provider community financially. The payment scheme should provide early payment to providers to enable them to plan and develop a properly resourced business. It should be based on a system of trust with oversight, which devolves responsibility for determining eligibility to providers and which would leave providers to apply funds as efficiently as possible to cases.
The speed with which the LAA processes bills or complaints or the number of matter starts would no longer be relevant criteria. The quality and value of outcomes for citizens or communities would be the only relevant criteria. The role of the LAA would be a collaborative one, designed to spread best practice and improve performance of providers. Its main KPI should be the building of a vibrant new SME sector comprising several thousand growing service providers.
This approach would relieve providers of the friction costs that the system currently imposes on provider organisations. No estimate is given of these costs. Experienced practitioners estimate that they account for at least 10 per cent of the financial support provided by the LAA. Removal of these friction costs would provide an immediate significant funding boost to the providers without any additional cost to the public purse.
3. Regional and cross-departmental funding
A devolved regional approach to funding would provide two significant benefits. First, it would enable funding to be tailored to the differing needs of different areas. Metropolitan needs differ greatly from the needs of rural or coastal communities. The availability of existing advice sector organisations differs greatly in metropolitan areas when compared with advice ‘deserts’. The funding approach will therefore differ significantly according to geographic location.
The second benefit lies in the ability to provide a collaborative approach to the provision of legal advice. The creation of standalone providers in areas where there is no advice currently is likely to provide an insuperable challenge. There is growing evidence in areas such as health, immigration and social care that legal interventions can provide solutions to problems that present themselves in non-legal settings. The response will increasingly be to provide a collaborative approach to the resolution of problems. The oversight of such a response will need to be tailored closely to the resources that are currently available. It does not lend itself to a central, rules-based approach.
The collaboration will need to extend to funding organisations (whether state funding or third sector). Local flexibility will be required to construct new combined funding streams designed to solve problems in new ways. If funders do not collaborate, it is unlikely that providers will be able to.