A new survey has found widespread ignorance in the profession of how the practising certificate fee funds regulation.
The survey of 967 legal professionals and entities by the oversight regulator the Legal Services Board showed many people are not aware of what their contributions pay for.
Among the 365 responses from entities regulated by the Solicitors Regulation Authority, 48% did not know they pay for the LSB and 40% did not realise they fund the Legal Ombudsman complaints service. There was more awareness of frontline regulators, with only 18% saying they were unaware they pay for membership of the Law Society and one in 10 not knowing that they fund the costs of the SRA.
Among all regulated legal professionals, at least one-third were ignorant that they covered the costs of the LeO.
Entities regulated by the SRA were more likely to see PC fees as poor value for money compared with those regulated by other bodies, while solicitors were also more likely to see compliance costs as high.
Satisfaction with regulation costs was more likely among bigger firms, with more than half of sole practitioner entities seeing fees as poor value for money.
Some authorised professionals also fail to distinguish between statutory regulatory requirements and discretionary costs, such as membership of accreditation schemes.
LSB chairman Sir Michael Pitt said: ‘I am determined that we minimise regulatory burdens on the legal profession. This is important because ultimately those costs are passed on to business and consumers. There are clear consumer benefits to a lower-cost regulatory regime.'
A spokesman for the Law Society said it was necessary to be cautious about the survey given the limited sample size, but described the findings on attitudes as ‘interesting’.
‘The cost of regulation will always be a contentious issue,’ he added. ‘It is important that regulation is proportionate and balanced with the need for proper consumer protection. Future work on regulation should take account of this.’
The research forms the first report in the initial phase of the LSB’s cost of regulation project. A report later this year will draw together all the research from the initial phase of the project.
This report will discuss the possible reasons for the results and draw conclusions around areas that may need further investigation and policy analysis before the LSB can set out policy proposals.