LSB: Resource pressures
The Legal Services Board (LSB) plans to increase its “capacity and capability” to launch investigations into, and reviews of, the frontline regulators “on a regular basis”.
The LSB said this would help it respond to issues “more proactively and dynamically”, for example in its decision to commission an independent review of events leading up to the collapse of Axiom Ince.
The oversight regulator said, in a consultation on its draft business plan for 2024/25, that it would be putting “a particular focus on strengthening our direct regulatory oversight of regulators’ performance and seeking assurance that they are well-led”.
The LSB, which is seeking an increase of 14% in its budget for 2024/5, said these efforts would “require the increased resource we are proposing”.
They would include “stepping up our ongoing monitoring and increasing our capacity to carry out reviews and investigations”.
The LSB completed a six-month investigation into the dispute over the future of regulation between the Chartered Institute of Legal Executives (CILEX) and CILEx Regulation (CRL) in April this year.
It concluded that CILEX had the power, in principle, to switch regulator from CRL to the Solicitors Regulation Authority (SRA), while deciding against enforcement action.
The draft business plan said: “While the CILEX/CRL investigation provided important and necessary clarity and precedent on re-delegation of regulatory functions and expectations of the behaviours of approved regulators and their regulatory bodies, it was resource intensive and time sensitive.
“This put not insignificant pressure on, and challenge to, the LSB’s resources alongside other priority work commitments, as well as day to day business as usual activity.”
The LSB said it had experienced “similar resource pressures previously” with reviews to determine the extent to which the Bar Standards Board (BSB) and Faculty Office, which regulates notaries, were “well-led”, one of its performance criteria.
The BSB review concluded in December 2021 that the regulator lacked access to “sufficient capability, capacity and resources”. The review of the Faculty Office, completed the month before, found the regulator lacked transparency when making decisions.
The LSB said it proposed to build resilience for the future “through increased capacity and capability to carry out these types of investigations and reviews on a regular basis” as part of its oversight function.
This would help it “respond more promptly and dynamically to issues in the public interest and protect and promote the regulatory objectives effectively”, one example being its “intention to commission an independent and objective review of the events leading up to the SRA’s intervention into Axiom Ince earlier this year”.
The LSB said it planned to continue with existing work on increasing diversity in the profession, professional ethics, “supporting the new regulatory objective by ensuring regulators are taking appropriate action to detect and prevent economic crime” and considering the role for regulation in improving access to justice and reducing unmet legal need.
Mr Hill commented: “Over the next year we want to strengthen our direct oversight of the regulators, ensure high standards and oversee the full implementation of polices that will drive change in the sector.
“Strengthening our oversight will mean we have better capability to see issues arising before they cause harm to consumers and the public.”
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