The Legal Services Commission (LSC) is extending most criminal contracts until 2008, it said this week - but solicitors have argued that it has still put the 'sword of Damocles' over the head of the profession.

Despite having the option to cut short contracts in March 2007 outside of London, the LSC says it now plans to extend them by at least 12 months, although it retains the current right to invoke a six-month termination clause. In the capital, firms will remain under a three-month notice period.


However, the Legal Aid Practitioners Group (LAPG) pointed out that if the LSC can order six months' notice at any time because of policy changes by the Department for Constitutional Affairs (DCA), it could theoretically bring most contracts to an end in October 2006 if it terminated contracts this week.


LAPG director Richard Miller said: 'Legal aid firms are businesses that need certainty from year to year. This announcement does not provide it; on the contrary, it keeps the sword of Damocles hanging over firms' heads.' He added: 'This is precisely why we opposed the provision for six months' notice in the event that DCA policy changed.'


But Rodney Warren, director of the Criminal Law Solicitors Association, said the LSC had the option of serving notice that it was terminating the contracts immediately if it saw fit and had acted in the best interests of law firms by holding off in light of the Carter review. 'If the LSC had simply given notice to terminate it would have caused a great deal more uncertainty and confusion among the profession,' he said. 'Firms need certainty for business planning but sometimes flexibility is needed for major changes.'


Meanwhile, East Midlands firm Nelsons has transferred its £2.75 million-turnover department to Cartwright King after moving its focus from legal aid to commercial work. Nelsons' chief executive Tim Hastings said the Carter review and plans to introduce competitive tendering would 'not sit comfortably with our plans to develop in other areas'.