Ombudsman calls for single regulator

By Jonathan Ames

A single external body should regulate legal services in England and Wales, according to the Legal Services Ombudsman (LSO), whose 2001/02 report was presented to Parliament this week.

In the report, the LSO, Ann Abraham, described the existing regulatory regime for the legal profession as a 'maze'.

She suggested that the government should consult on the future of regulation for lawyers, using the Financial Services Authority (FSA) and Financial Services Ombudsman as a benchmark.

Speaking exclusively to the Gazette, Ms Abraham said: 'I don't think the current arrangements for regulating legal services work in the consumer and the public interest.'

She said there was 'a serious issue' about the lack of any overarching strategy for all the various players - the professional bodies, Office for Fair Trading, Lord Chancellor's Department (LCD), Master of the Rolls, Immigration Services Commissioner and Legal Services Commission.

'Those agencies and regulators don't all operate by the same rule book.

There are too many referees on the pitch.'

Ms Abraham insisted that her proposal would not end self-regulation.

'The FSA regulates activities, not people.

Things such as entry to the profession should stay with the professional bodies.'

Reaction was cautious.

Law Society chief executive Janet Paraskeva pointed out that the Society had 'recently introduced significant changes to the way in which the profession is regulated, to make it more accountable and representative of the public it serves.

Those reforms need to bed down'.

She continued: 'There seems little point in throwing the whole system up in the air now to create a new regulatory model.' However, she said the Society would soon launch a benchmarking exercise, measuring complaints-handling practices against other professions.

Ms Paraskeva said the Society would be keen to consider a more co-ordinated approach across the legal profession.

The LSO's call came against the backdrop of a report which had mixed messages for the Law Society.

It showed that her office investigated slightly more cases relating to the handling of complaints by the Office for the Supervision of Solicitors (OSS) in the last year compared with the previous 12 months (1,629 against1,507).

She was satisfied with OSS handling in 58% of the cases (57% in 2000/01).

The agreed satisfaction target was 70% for the first six months of 2001, and 75% for the last six.

Ms Abraham formally criticised the OSS in 11% of cases.

There were 270 recommendations that the OSS should reconsider the complaint and 284 that it should pay compensation.

In 55 cases, a report contained both recommendations; the total of awards made was 69,000.

The ombudsman also drew attention to the danger of a rising caseload at the OSS.

She acknowledged that the backlog of service and conduct complaints had dropped below the target ceiling of 4,500 by the end of 2001.

However, Ms Abraham said that work in progress was up 32% since January 2001.

Ms Paraskeva responded: 'We recognise that in the first quarter of this year our performance was disappointing, but to take a brief period out of context is misleading.' Chancery Lane issued figures acknowledging that caseload backlog had increased - up to 5,918 in May 2002 - but it said the position was far from unmanageable; in July 1999, it was more than 17,000.

The Society also said that as of May 2002, about 60% of cases were being dealt with within three months.

That compared to a January 2000 average of nine months.

Ms Paraskeva highlighted the appointment of outgoing MI5 chief Sir Stephen Lander as the Society's first independent commissioner as a positive step forward.

Sir Stephen is to lead the benchmarking exercise.

At a briefing this week, Sir Stephen said he accepted that self-regulation was not the culture of the age, and that government threats to withdraw self-regulation hang 'like a sword of Damocles' over the OSS.

An LCD statement said there is concern about the Society's performance over complaints handling, but said it was not a universal problem as the other branches of the profession 'are getting complaints handling right'.

It added: 'However, we were interested to note Ms Abraham's comments.

The government will be considering what, if any, action needs to be taken.'