'Positive' steps made as small firms talk face-to-face with SRA

A group threatening to call a vote of no confidence in the Solicitors Regulation Authority says it has held constructive talks with the regulator over key areas of discontent.

The SME & Boutique Law Firm Alliance met with the SRA one week after the regulator had acceded to the group’s call to pause plans to separate the roles of law firm manager and compliance officers.

The alliance said the meeting had been a ‘positive step forward’ with some important matters discussed and agreed. The group was represented by co-founders Jade Gani, Peter Redmond and Kate Burt. The SRA was represented by executive directors Aileen Armstrong and Kate O’Neill, who cover strategy, innovation, external affairs and communication.

In a statement published following the meeting, the alliance said: ‘There were encouraging signs that the SRA is beginning to move in a new direction, with greater recognition of the importance of meaningful engagement with the profession and listening to the perspectives of those it regulates. That is a welcome development.

‘However, rebuilding confidence will take more than words or individual policy decisions. The alliance believes there remains a considerable way to go before the profession can have confidence that this represents a sustained change in regulatory culture, transparency and accountability.’

It was agreed that the compliance officer reforms, which were due to come into force in January, remain paused pending further consultation and evidence gathering. The SRA has said in the past that separation is important as an extra safeguard to protecting client money, following cases in recent years where managers have held dual roles and not been subject to the checks that COLPs and COFAs are supposed to provide.

But small firms question whether the proposals would have made any tangible difference and warn that they will struggle to find or fund the extra compliance specialists who would have to be recruited.

According to the alliance, the SRA has confirmed it will consider changing how consultations affecting particular cohorts are conducted, so that the SRA proactively contacts representatives from those its data identifies will be affected.

The alliance said it continues to consider its proposed request for a vote of no confidence in the SRA board at the Law Society AGM. Members state they have underlying concerns that extend beyond the COLP/COFA changes which arise from wider questions of regulatory governance, accountability and confidence.

The statement added: ‘We support strong and effective regulation which protects clients and maintains confidence in the profession. What we have consistently asked for is regulation which is evidence-led, proportionate and developed with a proper understanding of the firms expected to implement it.

‘We will therefore continue to engage constructively with the SRA while also holding it to account where necessary. Constructive engagement and robust scrutiny are not mutually exclusive.’

This Thursday, the group will meet with the Legal Services Board, together with representatives of the Law Society, to have wider discussions around proportionality, regulatory accountability and the experience of SME and boutique firms.