The Ministry of Justice has denied it has plans for the ‘wholesale privatisation’ of the courts service – despite extra pressure from the Treasury to reduce spending.
The MoJ moved to quash speculation today after reports that hedge funds and private investors were being encouraged to invest in courts with the incentive of an attractive rate of return.
Justice secretary Chris Grayling confirmed in March that his department was looking at ways to ‘raise the revenue and investment’ necessary to modernise the courts system.
An MoJ spokesperson said the proposals would not be as radical as some speculation has indicated.
‘We have always said we are determined to deliver a courts system that is more effective and efficient and provides improved services for victims and witnesses.’
The spokesperson added: ‘The proposals being considered are not the wholesale privatisation of the courts service. We are committed to the firm, fair and independent administration of justice.’
Meanwhile, chancellor George Osborne (pictured) has confirmed that the MoJ is one of seven departments that has agreed to cut another 10% from its budget from 2015/16.
‘This will enable us to get this deficit down and also, crucially, spend money where I think the public want it spent,’ Osborne said today.
The chancellor has already imposed £142m of cuts on the ministry, which will have to be implemented before the 2015 general election.
The MoJ is one of the government departments required by the budget to reduce its spending by 1% for the next two years.
That will mean a reduction of £73m in 2013/14 and £69m in 2014/15, when the overall budget will be £6.8bn.
The justice budget has shrunk from around £9bn when the coalition came to power, with departmental efficiencies, staff cuts, court closures and £350m cuts to the legal aid budget accounting for much of the savings.
Sadiq Khan MP, shadow justice secretary, said: ‘It’s right that rich foreign litigants that choose to use our commercial courts should pay more for the privilege but handing over wholesale our courts to big private companies and hedge funds whose primary objective is profit would risk compromising the independence of our courts and judges.
‘Victims of crime rightly want to have confidence that our justice system convicts and sentences those guilty of crimes in a clear and open way, free from interference. Civil litigants also want to know that a trial in an English court will be fair and impartial.
‘We are happy to work with the government to find savings and efficiencies in our court system but instead of focusing on this, the justice secretary yet again appears to be pursuing ill-thought-through proposals and putting out rushed, botched announcements with scant regard for the consequences.
‘He should think through very carefully the full implications of his plans before he wrecks a system which is the envy of the world.’
Mark Serwotka, general secretary of the Public and Commercial Services union, which represents many court service staff, said: 'It is heartening to see that the mainstream response to this proposal appears to be shock and condemnation and it deserves to be killed off before it gets any further.
'Quite clearly this is an ideologically driven plan to hand more of our vital public functions over to private companies who have shown time and again they are incapable of providing either value for money or properly run, accountable services. The pursuit of profit has absolutely no place in our justice system.'