Local authorities have complained that conditional fee agreements (CFAs) have increased claims against them and their costs - but also recognise that they have sharpened up systems and service standards.

Research carried out on behalf of the Local Government Association and Zurich Municipal found that 87% of authorities believe CFAs have increased the number of claims for compensation, with 68% reporting an increase in tenuous or fraudulent claims.


The report cited several extreme examples, such as a claim for an accident in a play area that did not exist at the time of the alleged claim.


While most blame greater publicity from claims companies, some 40% attributed the rise directly to the introduction of CFAs.


Some 96% agreed with the statement that 'there is an increasing tendency for lawyers and other advisers to encourage people to make compensation claims'.


Nonetheless, councils appreciated that CFAs offered access to justice for those who would not otherwise be able to afford legal advice, and that they have acted as a catalyst to make councils 'introduce more proactive monitoring of services and preventative action than might otherwise have been the case'.


At the same time, they said the increase in bad claims has led to lengthy delays for genuine claims and a 'tremendous amount of resources' being absorbed in dealing with all claims.