Law Society: £8.5m increase in funding over three years
The Law Society wants solicitors to pay £1.76m more towards its operations next year, taking the amount the profession contributes to nearly £37m.
The consultation it issued yesterday follows the now-former chief executive of the Legal Services Board (LSB) last week questioning why solicitors and others are forced to pay towards the work of their representative bodies through fees intended primarily for regulation.
Although solicitors do not have to be members of the Law Society, they cannot opt out of paying for its upkeep through their practising fees.
The society is seeking a 5% increase in its portion of the practising fees, in line with the plans set out in 2022 for the following three years. It follows rises of 15% and 7% in 2022/23 and 2023/24. It cast 5% as an extra £4.20 per practising certificate, which is £307 for the current year.
For the current year, 27% of practising fees, or £35.1m, went to the Law Society for its work, meaning 5% will raise a further £1.76m. At the start of the plan in 2022, its budget was £28.5m.
The Law Society’s overall budget this year is just over £46m, with most of the difference coming from commercial activity.
In total, solicitors are paying £128m in the current year through practising certificate and firm fees (split 40/60), an 11.5% increase on last year.
The Solicitors Regulation Authority – which has yet to outline its budget for next year – takes 53% of this (£67.6m), with the remaining 20% being costs levied on the profession by the LSB, the Legal Ombudsman, the Solicitors Disciplinary Tribunal and the Financial Conduct Authority for the work of the Office for Professional Body Anti-Money Laundering Supervision.
The Legal Services Act 2007 allows a portion of lawyers’ practising fees to go to the approved regulators to use for specific so-called permitted purposes that go beyond regulation, such as law reform.
The smaller bodies do not take advantage of this but the ‘big three’ of the Law Society, Bar Council and CILEX do.
Speaking before he left the LSB, Matthew Hill told Legal Futures: “I have worked in lots of different sectors of the economy. I’ve never encountered another in which professionals have to pay for their trade association…
“The permitted purposes provisions in the Act effectively provide for a statutory funding stream for trade associations. I wonder whether the security of that income stream has resulted in some professional bodies being perhaps less accountable or feeling less accountable to their members than they might otherwise have been.”
The Law Society said the increase would help it “continue to better support the profession”.
When setting out its plan in 2022, the society polled solicitors for their views. It received 1,461 responses, both directly and through focus groups, with 57% agreeing to the increases over the period.
Yesterday’s consultation said: “The results from our consultation last year (spring 2023) showed that our members’ priorities appear to focus on the availability and accessibility of resources and frontline member services.
“Members also want the Law Society to do more to promote and champion the profession to the public and to government.”
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