Legal aid providers as a whole will see their income slashed by up to £154m annually, it emerged today, as the government unveiled its plans for reform of the system.
A wide range of civil cases will no longer be eligible for legal aid, and fees paid in civil and family cases will be cut by 10% across the board, according to Ministry of Justice plans set out in a consultation paper, Proposals for the Reform of Legal Aid in England and Wales, released today.
Small legal aid providers are likely to be ‘disproportionately affected’ by the reforms compared with other legal aid providers, accompanying papers said. Legal aid firms across the board stand to earn between £144m and £154m less annually, the documents said.
Under the plans, £350m will be saved from the MoJ’s budget by 2014/15 if its proposals are implemented in full, the government estimated.
The key civil and family cases that would be cut from the legal aid scheme are:
- Private law children and family cases (where domestic violence is not present);
- Immigration where the individual is not detained;
- Clinical negligence;
- Ancilliary relief cases (where domestic violence is not present);
- Consumer and general contract;
- Welfare benefits;
- Legal help for the Criminal Injuries Compensation Authority;
- Debt matters where the client’s home is not at immediate risk; and
- Certain housing matters.
The government confirmed that competitive tendering for criminal legal aid will be introduced in 2011/12, and later, for civil and family legal aid.
The government simultaneously launched a consultation on Lord Justice Jackson’s recommendations for reforming civil litigation costs. It proposes taking forward Jackson’s recommendations to abolish the recoverability of success fees and after-the-event insurance, to allow contingency fee agreements, and to increase general damages by 10% in personal injury cases. The government said it will wait until the Legal Services Board completes its review of referral fees before choosing whether or not to follow Jackson’s recommendation to abolish them.
Justice secretary Ken Clarke said: ‘I strongly believe that access to justice is the hallmark of a civilised society. But at more than £2bn each year, we currently have one of the most expensive legal aid systems in the world. This cannot continue.
‘Since the scheme was established in 1949, its scope has been widened far beyond what was originally intended. There has never been a substantive review of the entire system to ensure it is sustainable, proportionate and affordable.
‘I believe that the taxpayer should continue to provide legal aid to those who need it most and for serious issues. But the current system can encourage lengthy, acrimonious and sometimes unnecessary court proceedings, at taxpayers’ expense, which may not always ensure the best result for those involved.
‘The proposals I have outlined today suggest clear tough choices to ensure access to public funding in those cases that really require it, the protection of the most vulnerable in society and the efficient performance of the justice system.’
Law Society chief executive Desmond Hudson said: ‘The lord chancellor has made it clear that only the poorest of the poor will continue to be eligible for legal aid. If the government persists with these proposals it would represent a sharp break from the long-standing bipartisan consensus that effective access to justice is essential to underpin the rule of law.
‘Legal aid clients are some of the most vulnerable in society and good legal representation where required is essential if they are to obtain justice. The Society will now consider the green paper in detail.’
Justice minister Jonathan Djanogly said of the civil litigation costs consultation: ‘We want to reduce overall costs, ensure claimants have a financial interest in controlling legal costs incurred on their behalf and deter avoidable, unnecessary or unmeritorious cases. Under the current arrangements claimants generally have no interest in the costs being incurred on their behalf because, win or lose, as they do not have to pay anything towards them.
‘Today’s proposals are designed to prevent the situation in which, regardless of the merits of their case, defendants are forced to settle for fear of prohibitive costs. I want to strike the right balance between access to civil justice and ensuring that costs are proportionate, sustainable and affordable.’
The paper highlighting the estimated £154m maximum loss of income to legal aid providers, and the impact on small firms, is an impact assessment titled Cumulative Legal Aid Reform Proposals, released alongside the government’s main consultation document.