House of Lords: minister rejects Tory call for government to pay start-up costs




The £27 million start-up costs of the new system of regulating legal services will be levied on the profession in instalments, the government said last week as it refused to move on the principle of not contributing itself.



In the final day of the Legal Services Bill's committee stage in the House of Lords, Department for Constitutional Affairs minister Baroness Ashton rejected Conservative amendments that the government pay all the start-up costs, and a third of the running costs.



Shadow Lord ChancellorWho? Peter Garsden, 49-year-old managing partner and head of the child abuse team at Cheshire firm Abney Garsden McDonald.



Why is he in the news? Represented the Manchester children's homes abuse group who were between them awarded more than £2 million compensation for alleged acts of sexual and physical abuse. The High Court in Manchester ordered the city council to pay a total of £2.3 million to the group of 168 individuals. The case arose out of a police investigation from 1997 to 2002 - Operation Cleopatra - that looked into allegations of child abuse in 66 children's homes in Greater Manchester, dating back to 1958. Manchester City Council's social services department ran most of the homes involved. Four people have been convicted in connection with some of the abuse allegations and two other alleged abusers were too ill to stand trial. The victims' group was closed after last week's hearing, but the court may allow new claims if more victims come forward.



Background: Law degree at Staffordshire University followed by Law Society finals at the College of Law in Chester and articles with Berrymans Lace Mawer in Manchester. He qualified in 1981 and worked at Lake New & Hurst in Stockport and JF Fielding & Co in Cheadle Hulme before setting up his own firm in 1985.



Route to the case: 'We were instructed by a number of the victims because of our reputation for doing these kinds of cases.'



Thoughts on the case: 'The damages awarded for child abuse by legal precedent are fairly pitiful when you consider the money is paid for ruined lives and equates to £2.70 a day in the worst cases. The attitude of Manchester City Council was conciliatory and came from a genuine desire to try and compensate for the past, which was laudable and a different attitude to what we encounter when insurers are involved. However, the survivors' desire is not for the money, but for the opportunity to tell their story in court which, frustratingly for many of them, never happens.'



Dealing with the media: 'I have been dealing with the media since the mid-1990s, but I can't recall a time when there has been quite so much interest. I generally find them empathetic and understanding in child abuse cases, and they do understand the need for anonymity. But they are interested in the human stories and not the legal issues, which I'm often trying to get across. What illuminated the media in this case was the amount of money involved. The media is a good means of communicating new group actions to the general public. In this case there were initially only 15 people in the group, but following appeals in the local press that figure rose to 168.'



Catherine Baksi Lord Kingsland said: 'There should continue to be, at the very least, a taxpayer contribution to start-up and running costs to reflect the costs that would have fallen on the public purse had the present regulatory arrangements been retained.'



He added that as the proposed legal services board has a wider public interest role than just overseeing the conduct of practitioners - such as in ensuring access to justice - it should not be left to lawyers alone to bear the cost.



He was supported by the Liberal Democrats, for whom Lord Maclennan said: 'It is not self-evidently true that those being regulated should bear the cost of regulation. Regulation is being introduced... to protect the public interest and, if the full costs of establishment are to be met by the professions, there must be a concern that those costs would be lumped on to those who have to purchase the services of the professions.'



Former Conservative Lord Chancellor Lord Mackay emphasised this point. 'It is worth recalling that, in so far as cash burdens are imposed on the legal profession, these will be charges on access to justice for those who are consumers of legal services,' he argued.



Baroness Ashton would not be moved, however. 'We believe that legal services providers enjoy exclusive access in the provision of reserved legal services, which can lead to them providing ancillary legal services,' she said. 'We hope and expect the profession will gain from the increased consumer confidence that these reforms will generate and that consumers will enjoy greater access to justice when things have gone wrong for them. We hold to the view that the costs should be met by the professions.'



She added, however, that 'to minimise any potential pressure on approved regulators, the recovery of [start-up] expenditure will be done on a phased basis, rather than in a single year'. The Law Society has to add around £10 to the practising certificate fee to raise £1 million.



The Bill will now move to its report stage, at which the government will make concessions on various points. It is expected that these will be tabled before the Easter recess.



Neil Rose