Criminal firms will collapse, not consolidate, if legal aid cuts are too fast, government warned

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Police station work: flat fee unsuitable

If criminal legal aid solicitors were given more time to put their house in order before the government slashed fees, there would be a greater chance of consolidation in the market to mitigate the cuts, the Ministry of Justice (MoJ) has been told by the Law Society.

But criminal practitioners urged an independent review, warning that if the profession was subjected to such an economic squeeze, it would cause a catastrophic breakdown of the entire criminal justice system.

The contrasting messages, given in response to the MoJ’s second consultation on reforming legal aid, Transforming legal aid: next steps, represented different strategies: the Law Society appealing to the government to tweak its proposals so as to delay the inevitable and provide breathing space; and the other, from the Criminal Law Solicitors Association (CLSA), warning against – among other things – the political cost that would result from a collapse of the system.

The society’s response was consistent with an open letter written to the profession last week by its chief executive Des Hudson, which expanded on the society’s belief that more could be achieved from constructive engagement than a flat refusal to accept public spending cuts from a government entitled to impose them.

Reiterating its opposition to a fee cut of 17.5%, the society said it would “involve an unacceptable risk to the future sustainability of the sector” and potentially lead to “advice deserts”, tensions on solicitors’ duties to clients, and possibly damage to “the integrity of the justice system”.

But if the government insisted on going ahead, it should consider either staging the reduction, with the first cut reduced to 5% in early 2014 and the second to 12.5% in 2015, or delay the entire cuts until spring 2015. This, the society argued, “would at least give firms the time to make changes to their business structures; undertake mergers and so on, which may help to start generating cost savings which might mitigate the impact of the cut”.

Meanwhile, even with the principle of ‘swings and roundabouts assumed by the new system, the inflexibility of the proposed £160.45 police station attendance flat fee would not properly take account of exceptional cases, the society argued. It gave examples of real cases such as complex fraud which would ordinarily take nearly 21 hours and cost over £1,000, and conspiracy to murder taking 23 hours and costing nearly £1,100.

The CLSA took a different tack, praising the government’s “political courage” in abandoning key plans on competitive tendering and client choice in its first consultation, but attacking “deeply dangerous” proposals which would “trigger the collapse of the access to justice” and bring cuts that would “be the tipping point which no amount of consolidation will ameliorate”.

If the worst happened, there would be serious consequences for the politicians who brought about this disaster, it predicted: “Ministers will be faced with a fairly rapid collapse of the whole profession who are involved in criminal practice with consequential massive harm done to the [criminal justice system] and a terrible political price to pay and media ‘fall out’ for those responsible.”

It dismissed anyone who claimed the Government’s proposals were workable as “a clear minority of eccentric individuals or ‘chancers’”.

It called for an independent inquiry: “We want reform and change that reduces cost without destruction. It is achievable and we ask for the opportunity to prove that before a fast track but independent inquiry because frankly we know the MoJ would actually benefit from that exercise.”

The CLSA rejected the government’s proposed timetable of an 8.75% fee cut in 2014 and the same in 2015, in stark terms: “It could not be more catastrophic and reckless… Firms will collapse and not in an orderly structured way. They will simply fold.”

It concluded: “Apart from the cost of trying to salvage a disaster with firms collapsing left right and centre, there is the certainty that suppression of fees to this level will inevitably lead to miscarriages of justice; as a result prison numbers will increase and therefore any savings from the legal aid budget are likely to increase the prison budget.”

Separately, the senior partner of a leading criminal law firm told last week’s Legal Aid Practitioners Group conference that if consolidation brought the number of firms from around 1,600 down to 250-300 at most, the sector could thrive. Franklin Sinclair, who heads Manchester firm Tuckers, advised the MoJ to leave rural firms out of its plans, in order to avoid “havoc in the countryside”.