The chair of the Bar Standards Board yesterday accused the Legal Services Board of jeopardising the industry’s economic success by delivering a misleadingly negative impression of how well lawyers are regulated. Kathryn Stone OBE claimed the regulatory structure established by the Legal Services Act 2007 is ‘failing’.
Stone’s comments came in her farewell speech at Inner Temple Hall. She is leaving the board to become HM Inspector of Constabulary and Fire and Rescue Authorities.
In its most recent annual performance assessments of the BSB and Solicitors Regulation Authority, the LSB found that both frontline regulators had 'failed to demonstrate that they met the required standards in important areas, including that their operational activity is effective and clearly focused on the public interest'.
But Stone retorted: 'Where the current arrangements [established by the LSA] are failing lies in the relationship between the oversight regulator and the front-line regulators. That failure is manifest in the assessments the Legal Services Board has recently made of the regulatory effectiveness of the two biggest front-line regulators which oversee around 95% of the legal professionals in England and Wales.
'Legal services are a great UK success story marked by high levels of professional and ethical competence. Those services are manifestly not for the most part poorly regulated and it is deeply unhelpful to the reputation of a successful industry to say that they are.'
Stone declared that the the LSB’s board and executive 'are no more experienced' than the boards and executives they are overseeing. 'Oversight gives responsibility, but it does not, in itself, give sharper insight into, or greater care for, the public interest. Still less does it give a better understanding of the challenges of front-line regulation,' she added. 'Seen in this light, I think that oversight regulation would be better to direct its efforts to supporting the work of the boards of the front-line regulators and taking its assurance from the robustness of their own governance.'
Stone suggested the LSB would be better employed benchmarking equivalent regulatory functions across the front-line. 'We could then see what good performance looked like, how our own compared and aim to emulate the best.
'The Legal Services Board doesn’t provide such benchmarking, except by way of the blunt instrument of the annual regulatory performance assessment. Their distance…leads to excessively detailed scrutiny of our actions and approaches and the diversion of significant resources.'
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