LEGAL SERVICES BILL: Tories retreat from pressing Whitehall to pay start-up costs


The start-up costs of the new system of regulating legal services have gone up to £32 million, the government conceded last week - and it is adding a further £5 million to the figure to allow for unforeseen costs.



In the final day of the Legal Services Bill's report stage in the House of Lords, Ministry of Justice minister Baroness Ashton said that having refined the implementation plans and considered the amendments made to the Bill, the costs had escalated beyond PricewaterhouseCoopers' initial estimate of £26.8 million.



However, the Conservatives decided against pushing to a vote an amendment they laid that would have required the government to pay the start-up costs and a proportion of the running costs; under the Bill, the profession will have to pick these up.



There were three votes during last week's debate, two of which went against the government. Peers voted in favour of the Bar Council-inspired Conservative amendment giving the planned office for legal complaints (OLC) the power to delegate the handling of service complaints back to frontline regulators. The Law Society has not opposed this, but has been clear that it would not seek such a power for itself; the Legal Complaints Service is strongly against delegation.



Under the Bill, frontline regulators will continue to deal with conduct complaints and Shadow Lord Chancellor Lord Kingsland argued that, as the majority of complaints against barristers combined service and conduct elements, it made sense for them to be determined together. Baroness Ashton replied that a single body would be clearer and more consistent, and overcome public perception problems of professional bodies dealing with complaints against their members.



Peers also backed a 'polluter pays' amendment, providing that the OLC could not seek fees from lawyers against whom complaints are not upheld. The Bill is silent on the issue and Baroness Ashton said the government wanted to leave the OLC to determine the charging structure itself, subject to the approval of the proposed legal services board as well as the Lord Chancellor.



The Conservatives lost a vote to require solicitors employed by the Government Legal Service to have practising certificates.



A Ministry of Justice spokeswoman said it will 'reflect very carefully on the views expressed by peers' - although it is widely expected that it will seek to reverse the delegation vote in particular in the Commons.



The Bill has its third reading in the Lords this week, where there will be a bid to delay the implementation of alternative business structures, and will then go to the Commons, with the second reading expected to take place in early June.



Neil Rose