Some legal aid lawyers will benefit from increased fees from 22 December, although a commitment to raise rates in line with inflation currently running at 4% remains conspicuously absent.
The Ministry of Justice handed legal aid lawyers an early Christmas present this week: long-awaited pay rises. Justice minister Sarah Sackman told MPs that most fee uplifts for criminal, housing and immigration work would come into force on 22 December.
Solicitors have been waiting patiently for these increases. An extra £92m for criminal legal aid was announced last December, with the Ministry of Justice embarking on an eight-week consultation in May on how to carve up the hard-won allocation. Pay rises for housing and immigration work were announced in July.
Delay was perhaps inevitable, given it was all hands on deck at Petty France to keep operations running after the Legal Aid Agency’s systems were shut down following a cyber-attack.
On criminal legal aid, the MoJ confirmed that the fixed fee for police station work will be harmonised at £320 excluding VAT. The escape fee threshold – the point at which additional fees can be claimed in exceptional cases – will be set at £650 instead of the originally proposed £960.
Magistrates’ court fees, including youth court fees, will go up by 10%. Basic fees for the lowest paying offences under the Crown court fee scheme for litigators will go up, as will prison law fees (24%) and appeals work (10%).
Law Society vice president Brett Dixon hailed the extra cash as a ‘positive step forward and a short-term boost’ for the sector following decades of underfunding and cuts. However, Dixon was disappointed that the ministry has chosen not to address the additional costs of out-of-hours work.
Opting against calls for specific ‘out of hours’ remuneration, the ministry said the current police station fixed fee scheme accounts for unsociable hours. When fixed fees were introduced, ‘they took into account payments previously made at hourly rates, including payments for work during unsociable hours. The uplifts to police station fees will positively impact all providers, including those that work unsociable hours’.
The extra £20m announced in July for housing and immigration work marks the first major civil legal aid fee increase since 1996.
Research published by Chancery Lane last year revealed that lawyers were losing money doing housing work but felt morally obliged to keep going. While the precise magnitude of loss varies, a typical fee-earner is able to recover only around half of the full costs of providing housing legal aid from legal aid funding. The research found housing legal aid work was paid at hourly rates of £46-£72, depending on work type and location, whereas guideline hourly rates published by the Civil Justice Council ranged from £134-£546 based on solicitor experience and location.
Of the £20m promised, the ministry said £18m will be available now. The remaining £2m for licensed housing and immigration work will be delivered ‘as soon as possible’.
Law firm Duncan Lewis, which dropped legal action over immigration fees when a pay rise was promised, welcomed this week’s announcement. Consultant public law solicitor Jeremy Bloom said: ‘This is a significant and hard-won development for the legal aid sector. For years, providers have operated under unsustainable financial pressure while continuing to support some of the most vulnerable individuals in society.’
Bloom said the firm issued legal proceedings last year because the sector had reached ‘breaking point’.
Bloom told the Gazette at the time that Duncan Lewis calculated an average annual loss of £777,038 between 1 April 2020 and 31 March 2023 on controlled work immigration and asylum matters, based on the fees recovered for the work compared with the costs to the firm of undertaking the work, such as salaries, overheads and supervision. This equated to an average loss per matter of around £251. Between April 2014 and March 2018, the firm opened an average of around 4,000 matters per year. In 2023, it was around 800.
But while this week’s announcement was an ‘important step forward’, Duncan Lewis is concerned that fees for matters opened before 22 December will not rise, particularly given that the uplift was announced at the start of July. ‘This will have the effect of slowing down any increase in capacity within the sector, as it appears that providers will continue to be paid the same unsustainable rates for all ongoing work,’ Bloom said.
Chancery Lane says fee uplifts for both criminal and civil work will have limited impact if the government fails to commit to maintaining rates in real terms. The Office for National Statistics’ headline rate of inflation currently stands at 3.8%.
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