One of the most persistent myths in the legal profession is that sole practitioner numbers are declining. In fact, there was an increase from just under 3,000 in 1987 to 4,130 at the end of 2008. And, despite the difficult trading conditions of 2009, the number of sole practitioners has increased by a further 70 or so.

Of course, the term ‘sole practitioner’ can be misleading: some are actually very sizeable operations.

The SRA’s concern is the quality of service to the client, not the size of the firm providing it. We recognise that some sole practitioners and small firms operate in places that bigger firms might not regard as viable, providing valuable local access to legal services. Some advise on very specialist areas of law that bigger firms might not be interested in, and many provide a high degree of personal attention, which can be important to clients.

Because black and minority ethnic solicitors tend to work in smaller firms, the diversity of the profession and how well it reflects the society it serves could be harmed if those firms were driven out of the market. That is one of the issues discussed in our current consultation on regulating the new forms of practice enabled by the Legal Services Act.

The last thing the SRA wishes to do is to deprive clients of the services of sole practitioners and small firms whom they value. What does concern us, though, is the number of sole practitioners who get into serious trouble. The SRA intervened into 71 firms in 2008 to protect existing clients and their funds, and potential clients. Of these, 54 were sole practitioners. It is deeply worrying that, in 21 instances last year, suspected dishonesty was one of the grounds for intervention into a sole practice. Subsequent proceedings before the Solicitors Disciplinary Tribunal are the norm in such cases.

Pre-empting difficultiesThe question is, what should the SRA as a regulator – and the profession itself – do about this? Picking up the pieces after a firm has collapsed is bad for clients, bad for the firm’s employees, bad for the SRA and bad for the profession. We all need to get better at pre-empting difficulties, rather than reacting to them. Our Practice Standards unit (PSU), which visits more than 1,100 firms a year, considers that sole practitioners and smaller firms often find regulatory compliance challenging because of the resources they have to apply to it.

In the current difficult climate, firms inevitably prioritise fee-earning and income collection, so that staff wages and practitioners’ mortgages can be paid. They rarely have the ‘luxury’ of dedicated staff to deal with compliance; it is an additional task for fee-earners, as and when they can find the time.

That is not to say that sole practitioners cannot achieve good levels of compliance; many do, very effectively, by installing simple and streamlined processes. What it needs is a degree of creativity and early prioritisation – applying the processes before problems arise, rather than as a response to them.

The PSU (many of whose staff have worked in smaller firms, so understand what the challenges can be) urges solicitors to define as early as possible the core processes they need and then implement them rigorously.

A current concern is that some of those who are setting up in sole practice following redundancy do not appreciate the responsibilities they are taking on. It is vital that would-be sole practitioners fully understand the rules and obligations. The PSU is starting a series of visits to firms that were set up within the past six months to advise and assist them, and to check that their existing systems will aid compliance with the Code of Conduct and associated rules and regulations.

One obligation I should mention is that from 1 July 2009, new sole practitioners must obtain authorisation from the SRA to practise as a recognised sole practitioner (sole practitioners who were already in sole practice before this date have been automatically authorised). This is a consequence of the Legal Services Act 2007 and the shift to firm-based regulation.

Sole practitioners are also required to provide a small quantity of information to enable us to carry out risk assessments. Although this has been criticised as ‘outrageous’ and ‘intrusive’, sole practitioners are only being asked to provide the same information as other firms. The figures for interventions quoted earlier surely justify thorough risk assessment.

Support networkSo where can sole practitioners get help? The Law Society’s Lexcel practice management standard is (quite rightly) demanding, and covers risk management and compliance. Sole practitioners may feel isolated; networking with others can provide valuable support. I gladly recommend the Sole Practitioners Group for advice and networking opportunities (even if that group does not always see eye-to-eye with us on every issue). Or you might consider a reciprocal arrangement with another SP, so you can bounce ideas off each other and cover each other’s absences.

The SRA website is an invaluable source of information. And many sole practitioners have acknowledged, sometimes with evident astonishment, that a visit from our PSU has been a huge help, not only in sorting out compliance but in helping them to see their firm as others see it. Together, we can ensure that sole practitioners and small firms continue to provide valuable, trusted services to their communities.

Peter Williamson is chairman of the board of the Solicitors Regulation Authority