Lawyers and law firms dependent on state funding would be ‘wise to reconsider’ their expectations of earnings, the Lord Chancellor has warned.

In a stark vision of the future, underlining the government’s determination to press ahead with controversial legal aid reforms, Jack Straw said last week that while it is ‘entirely proper’ that lawyers are paid decent rates, running ‘successful legal businesses... is not the purpose of law’.

Speaking to an audience at the London School of Economics, Straw questioned whether legal aid lawyers should expect to be paid more than other public sector employees. While many legal aid lawyers have modest incomes, ‘for others, particularly at the top of the profession, and sometimes also in the middle ranks, the picture is very different and there is an expectation that they should receive rewards comparable to those in private practices’.

Straw said that the Legal Services Act would allow law firms to adapt. ‘This may well mean lone practitioners joining together, or smaller firms growing larger,’ he said. He dismissed suggestions that the changes would reduce access to justice. ‘I think access is at risk of being confused with physical proximity. People have grown used to a far wider range of telephone and internet-based services – and demand more rapid and convenient access to services, but not necessarily an office on the street corner,’ he said.

‘A further question individual practices need to consider is whether or not all of the functions currently carried out by qualified solicitors and barristers need always to be carried out by them... As paralegals take on more responsibility, as the legal executive profession develops, there should be scope to do more, quicker and at lower cost without standards falling.’

Straw drew an analogy with opticians’ services, largely provided by high street chains, ‘which benefit from substantial economies of scale, which in turn are passed on to the customer... The important factor here is that there has been no decline in the quality of the clinical service’.

Straw’s analysis drew mixed responses. Carol Storer, director of the Legal Aid Practitioners Group, said: ‘Legal aid lawyers work long hours, endure a great deal of stress and are often paid well below the market rate. Furthermore, an enormous amount of time is given up working with the Legal Services Commission and the Ministry of Justice trying to help the government devise and deliver the service. It would be good if these efforts were appreciated by government rather than undermined.’

Richard Miller, the Law Society’s legal aid manager, said: ‘The Law Society has always stood for a legal profession acting in the best interests of its clients and serving an important role in ensuring access to justice. We share the government’s aim of a vibrant profession offering the highest professional standards to the public.’