Antitrust watchdogs are barking up the wrong tree this time.
How much choice does a small-business owner truly enjoy?
Their electricity supplier will be one of a handful of corporations, as will their phone supplier, insurance provider and lender. What search engines should they consider paying to be placed at the top? I’ll give you a clue: Google it.
Even a post-work drink will likely offer the choice of a beer owned by one conglomerate versus another beer owned by its only main rival.
Yet when they come to select legal services providers, they’re almost spoilt for choice.
They can opt for a traditional firm, or a new entrant. They can choose from accountants, insurers or even charities. They can choose their high street firm, or one that is remote. There are unbundled services, fixed-fee services and virtual firms to choose from. They can even try DIY, backed by a few select instructions from a website.
In all, there are more than 10,000 legal services providers to choose from, a number that barely changes from month to month. If anything the choice is too much.
I suspect sometimes that the lack of a ‘big bang’ since the Clementi report and Legal Services Act mean its impact is understated.
But the market has changed enormously in a decade.
Consumers have masses of information online, access to a plethora (and growing number) of comparison websites, and the chance of redress and compensation for poor service.
The Competition and Markets Authority, a quango which presumably always has to be seen to be doing something, is still worried consumers are not getting a good deal.
It asks whether clients are adequately protected from potential harm or can obtain satisfactory redress if things go wrong. I would suggest the compensation fund, paid for by solicitors who don’t break the rules, let’s not forget, ticks that box.
Can clients make informed purchasing decisions? Perhaps they could be helped further, but this makes the (all too common) assumption that legal services are just another commodity.
Anyway, is there even that much of a problem? Complaints about solicitors are falling all the time, and the CMA can only cite a survey claiming one in 10 consumers feel they got poor value for money. In a sector dealing with contentious and emotional issues, I’d say that’s pretty good.
Sometimes there is just no telling what a service will entail, what unforeseen costs might crop up or what delays might be incurred. This is not as simple as ordering a decent pint.
How exactly can we increase competition? I suppose we could lift all barriers to entry, offer an open-door policy to any Tom, Dick or McKenzie who fancies having a go at being a lawyer.
But of course, we know what would happen then. Those same consumers upset about value for money would then get angry about a poor service from a cowboy provider. Not to mention who is going to bail out the clients when a fly-by-night provider takes off with their cash.
I look forward to hearing from the CMA about how to improve this market – I’m just not sure it needs to.
John Hyde is Gazette deputy news editor