Examination of Witnesses
Legal Aid, Sentencing and Punishment of Offenders bill
12:00 pm
Jim Sheridan (Paisley and Renfrewshire North, Labour)
Thank you very much for coming along and for your patience. For the record, could I ask you to introduce yourself?
Robert Buckland (South Swindon, Conservative)
It is good to see you again. I will ask you a question that I think that I have asked you before in my capacity as a member of the Select Committee on Justice. I know that you came in towards the latter end of the LSC’s lifetime, shall I say? I will not make any further comment.
I think that we all agree that the tendering process involving the family law contracts last year was a debacle, and we know that the result was defeat for the LSC in the High Court. What lessons have been learned from that particular episode, and how will the new Executive agency pick up the baton and ensure that that sort of scenario is not repeated?
Carolyn Downs: To put that in context, last year the LSC let more than 5,000 contracts on both civil and crime, and the one contract that was not let was the family contract. Regarding the lessons learned, I have commissioned a report. I get external people to do that and look at the issues around implementation, the making of policy, consultation and procurement. It is important to inform the Committee that during the last six months, we have defended 64 judicial reviews on our tendering process, of which just one was lost, and that was an issue of public law. In every instance of procurement law, we won those judicial reviews. That points, therefore, to the fact that when one undertakes consultation and the process of developing policy, that is the point at which we really needed to strengthen our processes.
We are currently out to consultation on the family tender, which we are now having to undertake because we extended the contract, effectively, and we have to undertake a new one. We are in the process of consultation. The discussions that we have had to date with the representative bodies, all of which were here earlier, have been extremely positive and the feedback that we have got from representative bodies to date is positive, even with those representative bodies accepting a reduced consultation time scale for us to undertake that work.
So there are some key issues for me: one is how you formulate policy; and the second is the time scales for implementation. An important lesson for us in the commission is how you project manage and programme manage those processes, because the programme and project management within the commission was not as strong as it should have been to see that through.
Robert Buckland (South Swindon, Conservative)
You are confident that that will be translated into the new arrangements in the Bill?
Carolyn Downs: We will have let that contract by February next year, in advance of any transition to Executive agency status. Following scope changes, we will need to tender the other civil contracts, save mental health, and we would anticipate doing those as the new Executive agency. Obviously we will have to take that whole process through into the Ministry of Justice.
Yvonne Fovargue (Makerfield, Labour)
What percentage of positive outcomes are recorded for legal aid and social welfare law cases?
Yvonne Fovargue (Makerfield, Labour)
I know that you collect a tremendous amount of statistics. Could you tell us the categories of clients that will lose access to justice if social welfare law is taken out of scope?
Yvonne Fovargue (Makerfield, Labour)
Could you tell us if those specific groups are women or people with disabilities? Would they be disproportionately represented?
Yvonne Fovargue (Makerfield, Labour)
But you collect statistics on the number of people with disabilities, females and so on, who access the categories of law?
Yvonne Fovargue (Makerfield, Labour)
You have that information then. The providers submit it to you because they have to in order to get the audit.
Elfyn Llwyd (Dwyfor Meirionnydd, Plaid Cymru)
You are shortly to become an Executive agency of the MOJ. Do you believe that the Bill protects you in terms of being independent of the Government in your decisions to grant legal aid? Have you taken external advice on this issue and have you consulted anybody about it?
Carolyn Downs: I think that the issue for consultation regarding the abolition of the Legal Services Commission and independent decision making is a matter for the Ministry. However, obviously, it is a matter that the commissioners have been careful to consider and that they have, indeed, covered in their response to the Government in relation to this.
There are two issues to raise. First, the level of independence in some respects is strengthened by the Bill in clause 4. Currently, on exceptional funding cases, the Lord Chancellor makes all the decisions. Clause 4 precludes the Lord Chancellor from making those decisions and pushes everything to the statutory office holder. On the issue surrounding the independence of the statutory office holder, we were very keen, in discussion with the Ministry, to ensure that they are protected from any political interference. We were concerned about that when the Green Paper came out and we felt comforted by the Bill’s provisions around the independence of decision making. I am clear that it will be important for us to look at the guidance that the Lord Chancellor gives to the statutory office holder in the future about what can and cannot be funded and how clear that guidance is.
Secondly, if I were the statutory office holder, I would be keen to ensure that the independent panels of solicitors and barristers whom we currently have and who deal with appeals against the decisions of executives in the Legal Services Commission remain in place. They can give that extra level of independence and uphold or, indeed, overturn the decisions of the statutory office holder. We are very keen to ensure that that independence remains in place.
Elfyn Llwyd (Dwyfor Meirionnydd, Plaid Cymru)
Have you made any inquiries about whether those panels will remain in place?
Jim Sheridan (Paisley and Renfrewshire North, Labour)
I again appeal for brevity from those asking the questions and those giving the answers.
Michael Crockart (Edinburgh West, Liberal Democrat)
My question is about the practical implications of the change from arm’s length public body to Executive agency. Have you had any investigations about the potential for savings that there might be in transferring the Legal Services Commission to the MOJ? Have there been any investigations as to whether your systems and processes are compatible?
Carolyn Downs: In terms of the savings that arise from the move across to the Ministry of Justice, we have identified £8.5 million-worth of savings that will come through effectively shared corporate services. I have worked well with the Ministry of Justice about the corporate services that will need to report directly to myself as chief executive, and will therefore be somewhat more independent, and those that will be in the central core of the Ministry of Justice. We have identified £8.5 million-worth of savings, largely from staff savings arising from that.
On top of that, there will be savings to the Ministry but not to the Exchequer in relation to the VAT status. Believe it or not, at the moment the Legal Services Commission pays considerable VAT moneys simply for another part of the MOJ to provide a service on our behalf.
In relation to systems, we have a new civil case management system, which we will be introducing next year, and we are ensuring that it is put on the same IT platform—an Oracle business suite—as the MOJ’s. We outsourced the production of our accounts in the course of the last year; they are being done by Liberata, the same people who do the MOJ’s core accounts. We are doing everything that we can to ensure compatibility.
Michael Crockart (Edinburgh West, Liberal Democrat)
I get the strong impression that you feel that this is a positive move for your organisation.
Alex Cunningham (Stockton North, Labour)
Previous witnesses have condemned the cuts to legal aid for the most vulnerable and the poor. Are such cuts the right ones? If not, should they be made elsewhere and, if so, where else could they be made, or do you think that the cuts are so severe that they do not serve justice?
Alex Cunningham (Stockton North, Labour)
Will your commissioners be able to serve justice with the budgets they will have to operate with in future?
Carolyn Downs: The commissioners will not exist, but the legal services agency will have a responsibility to deliver what the Government have requested it to do, post the Bill being passed one way or the other. My responsibility as chief executive will be to ensure that the appropriate resources are put in the right place to ensure that that delivery is undertaken, and that is what I am doing currently.
Alex Cunningham (Stockton North, Labour)
Bearing in mind what the Government are asking you to do, do you believe that having had the cuts imposed you will be able to deliver that?
Andy Slaughter (Hammersmith, Labour)
On a related point, I was just looking at your response to the Green Paper. The annex to that raises practical issues and concerns you had. It is admirably brief but I should like to ask you to amplify one or two of those points.
You say, on provider sustainability, that
“we have concerns that fee cuts may result in market failure and premature exits from the market where, for example, a firm or Not for Profit organisation becomes insolvent.”
From your knowledge of the market, do you think that is a serious concern? As well as the fee cuts, will it be affected by the scope changes?
Carolyn Downs: The issue around market sustainability is not one or the other; on civil, it is also about the single gateway. It is the impact of the three different budget reductions in relation to the single gateway, the fee reductions and the changes in scope. The area where we have had some concerns is about the large reductions in scope and the ability of certain parts of the legal services market to adapt to that, particularly the not for profit sector, which the Government absolutely accept in their impact assessments, and in the immigration and asylum field.
Andy Slaughter (Hammersmith, Labour)
You anticipate my next question. You say on the viability of not for profit sector:
“We have noted that these may be particularly threatened by the changes proposed, as these will coincide with funding reductions being made elsewhere…We believe the Government should look at the funding of NfP organisations collectively by the public sector to ensure that these valuable advice agencies are maintained at an appropriate level.”
Have you had any response from the Government as yet that they will be considering that?
Andy Slaughter (Hammersmith, Labour)
The problem is that before the Bill goes through, we have immediate local authority cuts. Law centres in west London—I represent Paddington law centre—could close tomorrow. You obviously have a clear concern that an important part of the provider market is going. Are you able to put a greater sense of urgency into this, as there may not be much to support by the time the reviews have been completed?
Carolyn Downs: That area of work, in terms of taking forward policy in relation to the advice sector more widely, is definitely a matter for the Ministry, and the Cabinet Office is taking the lead on that. It might be helpful for me to give you some statistics. At the moment, on civil, whether it is not for profit or solicitors, we have 3,370 providers. On crime we have 2,000 providers. Last year, 6% left the civil market, and 0.6% of them quoted as their reason for leaving “reform to the legal aid system”. On crime, the figure was higher; 9% left the market and 1% quoted legal aid reform as the reason. The point that I want to make is that we have a lot of providers.
Jim Sheridan (Paisley and Renfrewshire North, Labour)
I remind Mr Slaughter that his colleague is waiting to ask a question.
Andy Slaughter (Hammersmith, Labour)
Changes are happening this year and next year, not last year. You also say that
“experience in recent years has shown that working to unrealistic timescales has increased risks and resulted in poorer outcomes, as well as putting those most closely involved under considerable pressure.”
You note that “rushed implementation” may have to be halted, for example if there is a successful judicial review. Are you not concerned at the speed with which the changes are going through?
Carolyn Downs: We have had considerable discussions with the Ministry about the speed of change and the implementation, and continue to do so. I have raised concerns. We have extended the time scale on family tenders. We will not be implementing new family contracts in November, but in February, because the Ministry has taken on board the concerns that we had about the speed of that implementation and therefore the potential success of judicial review, if we did it one way or another. I am satisfied that the conversations that we are having with the Ministry, where we are raising real risks to implementation, are being taken on board.
Kate Green (Stretford and Urmston, Labour)
I am also interested in learning some lessons from your experience of managing the market. As you will know, in the past people have presented with clusters of problems in different categories of social welfare law. Clearly, as we strip most categories out of the ambit of legal aid, the possibility of dealing with those groups of problems will be removed. When you say that in the past a very small percentage of providers left the market as a result of legal aid changes, what is your view on the likely scale of departure from the market when whole categories of social welfare law are removed and therefore the capacity for the remaining providers to deal holistically with people’s problems?
Carolyn Downs: I do think that there will be an impact on the not for profit sector, particularly in social welfare law, without a doubt, and on their ability to adapt to a contracting environment and fixed-fee regimes. That is a risk. I feel, however, that we will have sufficient providers to be able to give a service.
You will be aware of the Immigration Advisory Service going into administration last week. I was concerned about coverage issues in relation to the IAS. I have been in discussion with the administrators over the past few days and we have a huge number of people contacting us who are prepared to take on that work. That is an immediate example where I was very concerned about whether we would be able to get coverage in non-urban areas in particular. It would appear from the contact that we are getting from external providers that they would be prepared to take on that work.
Kate Green (Stretford and Urmston, Labour)
Do you think, when whole categories of law can no longer be covered and there will therefore be dividing lines where legal advice can or cannot be provided in a single case or with a single client, that that is the most cost-effective and best-value way to support that client, looking at the cost to the public purse in the round?
Carolyn Downs: As you know, last year the Legal Services Commission tried to group many of its contracts and categories of law together on the basis that an overwhelming number of clients present with a multiplicity of issues, and that was how we undertook our contracting last year. With the family contracts that we are undertaking now we are not insisting that people do private and public family law; we are allowing people to do either one or the other because of the impending changes.