The Bar Council and the Criminal Bar Association (CBA) have today called for referral fees to be prohibited.

In a joint statement sent to the Legal Services Board, which is in the process of deciding whether or not to ban referral fees, the two bodies say that the fees ‘represent an unwarranted and unjustifiable threat to the public interest in the efficient and effective provision of legal services to consumers’.

The statement says that ‘attempts to provide a regulated system of referral fees have failed’.

It says that there ‘can be no halfway house compromise in relation to advocacy’, and that the right of the consumer to the optimal choice of representative in court ‘cannot be allowed to be prejudiced by referral fees’.

Bar Council chairman Nicholas Green QC (pictured) said: ‘It is plainly not in the public interest to maintain a system of referral fees, and in fact they represent a serious barrier to the provision of most appropriate advocacy. The failure of recent attempts to regulate referral fees leaves no fair alternative but to scrap them altogether.’

In his review of the costs of civil litigation, Lord Justice Jackson recommended that referral fees be banned. However, in its consultation on his proposals, the government decided not to form policy on referral fees, choosing to wait instead for the LSB to report back on its consultation on the fees.

In its paper outlining plans to improve regulation of referral fee arrangements, the LSB said in September that there is not ‘sufficient evidence’ to ban referral fees and that to do so would be ‘wholly disproportionate’.

The joint Bar Council and CBA statement says: ‘Individuals will be represented on the basis of the financial interests of those party to the payment, the details of referral fees will remain unexposed, costs will almost certainly increase, any such increase will be passed on to the public, and the field of providers of legal services may well be reduced. All of this is likely to occur without any increase in the quality of representation.

‘The effect of the Unified Contract Standard Terms 2007 and the 2007 Funding Order make it clear that both the payment and the receipt of any referral fee, and the practice of becoming "instructed advocate" in order to exploit the fund-holding position, are prohibited.’