The government has ruled out immediate further changes to the framework for legal services regulation following the wide-ranging review launched by the Ministry of Justice last June.

In a ministerial statement today, justice minister Shailesh Vara (pictured) said the consultation process ‘did not reveal any options for government to reduce regulatory burdens on legal service practitioners or to simplify the regulatory framework that did not entail changes to primary legislation’.

Vara said there was ‘no consensus on the longer-term vision’ for regulation among the 71 respondents to the consultation, which included the approved regulators, consumer bodies, practitioners, legal academics and the judiciary.

‘In light of the above, the government has decided not to take forward any changes to the statutory framework at this time,’ he added.

The announcement thwarts the radical ambitions of over-arching regulator the Legal Services Board, which lobbied hard for the introduction of a single regulator. Earlier this week, outgoing chair David Edmonds used his final speech to reiterate this demand for reform, while also taking aim at The Law Society and Bar Council by arguing that they should lose their statutory guarantee of funding.

Responding to today’s announcement, Law Society chief executive Desmond Hudson welcomed the retention of Section 51 of the Legal Services Act 2007. This defines how approved regulators are allowed to deploy practising fees, incorporating such ‘permitted purposes’ as raising professional standards and participating in the law reform and legislative process.

He told the Gazette: ‘If you look at the submissions to the consultation there were clearly differences of opinion. We are pleased Section 51 remains in place, but disappointed that some of the recommendations The Law Society made to the consultation will not be acted upon.’

Chancery Lane argued in its submission for a ‘more proportionate’ regulatory regime, recommending that internal governance arrangements be modified so the Society could assume direct responsibility for training and authorisation to practise.

It further argued that investigation and prosecution of offences should be undertaken at arm’s length by an operational arm of the Society with independent decision-making powers, but reporting directly to the Society.

In a statement this afternoon, Hudson added: ‘The Law Society shares the government’s desire to reduce the regulatory burden on practitioners in the legal sector and promoting innovation, competition and growth in legal services.

‘We argued in our response that while the reforms of the Legal Services Act 2007 have been successful in opening the market to new business structures and in improving the handling of complaints, the new regulatory structure remains complex and consequently creates a significant burden for our members.
'In our response we argued that there are a number of low-cost measures, which could be implemented in the short term, that would make regulation more proportionate and effective as well as minimising the cost to the profession. We look forward to working with the new leadership of the LSB and the other approved regulators to take these measures forward.'

Consumer watchdog the Legal Services Consumer Panel, which also called for simplification through a single regulator, tweeted that it was a ‘shame’ that the government had ruled out a further overhaul of the system. It did however welcome the fact that a ‘return to self-regulation is off the agenda’. 

The Bar Standards Board welcomed the government's announcement. ‘We will continue to modernise our regulatory regime to offer more flexibility and innovation, while ensuring that the public is properly protected,’ it said in a statement.

‘We also look forward to working with a refreshed Legal Services Board and its new chair, in the public interest.’