Jumping aboard the gravy train

While commercial law firms continue to declare annual profits amounting to hundreds of millions, cuts to legal aid mean many people are suffering. Why not redress this imbalance? 

Geoffrey Bindman
13 December 2016

Lord Bach is leading the Labour Party's commission on access to justice. Photo: Robert D. Ward/Wikimedia Commons. Some rights reserved.

The commission on access to justice initiated a year ago by the Labour party under the leadership of Lord Bach, a former justice minister and shadow attorney-general, has issued an interim report: “The Crisis in the Justice System in England and Wales”

The crisis has been building over several years and there is no magic solution. Yet Bach makes a good start by identifying the problems and charting the direction of travel towards the realisation of the ideals embodied in Magna Carta and developed in the Legal Aid and Advice Act 1949. It promises a final report in another year.

In his introduction Bach cites Magna Carta’s famous chapter 40: "To no one will we sell, to no one will we deny or delay, justice or right." This chapter remains part of our law to this day. The 1949 Act was intended to give effect to the principle, re-affirmed by the Law Society in its evidence to the Bach commission, that "nobody should be unable to enforce or defend a right for want of the advice and representation they need to do so effectively." Justice demands a level playing field. Justice demands a level playing field.

This of course does not mean that those who can afford to pay for advice and representation should be relieved of the need to do so. A means test is reasonable but the steady erosion of legal aid, both as to financial eligibility and the scope of the scheme, has severely undermined the principle of universal access to justice.

The proportion of the population remaining eligible for legal aid has steadily declined and many areas of law, such as housing, welfare, debt, immigration, medical negligence and family law, which affect not only the poorest but also the prime minister’s ”just managing”, have been virtually excluded from legal aid altogether. The Legal Aid Sentencing and Prosecution of Offenders Act 2012 (LASPO) made drastic cuts. In the last five years there has been a reduction of 34% in the spending of the Ministry of Justice. Yet at the same time, court fees have been prohibitively increased and tribunal fees introduced, preventing many who cannot pay them from pursuing their claims at all, however meritorious they might be. The stark reduction in the number of cases demonstrates this.

In an attempt to mitigate the damage caused by the Legal Aid, Sentencing and Punishment of Offenders Act 2012, the Legal Aid Agency was empowered to grant funding exceptionally in cases of hardship. Bach says this has failed because the criteria are too strict. From October 2013 until June 2015 only eight children and 28 young adults were granted legal aid under this scheme.

For every £1 of legal aid expenditure on housing advice, the state potentially saves £2.34; and for every £1 spent on benefits advice, the state potentially saves £8.80.

Bach also criticises the inadequacy of public legal education and the closure of not-for-profit legal advice services, the number of which has fallen from around 3,226 in 2005 to 1,462 in 2015. The Commission is also unhappy with the bureaucracy of the Legal Aid Agency, whose administrative costs are said to have increased by £2.1 million while its overall budget has been cut by 25%.

Bach is unduly tentative in not advocating reversal of the LASPO cuts, or expanding the legal aid budget. A promise to “make access to justice a reality” cannot be made good without increased funding.

In fact, the report makes a very strong case for increasing legal aid funding, as well as funding for advice centres and law centres and for legal education, in order to save public expenditure on other services. If the abstract notion of justice is not enough to persuade government, surely the prospect of saving public money should be. The report cites evidence from Citizens Advice that for every £1 of legal aid expenditure on housing advice, the state potentially saves £2.34; and for every £1 spent on benefits advice, the state potentially saves £8.80. Research by the New Economics Foundation, says the report, estimates that the social return for advice given by law centres could be up to £10 for every £1 spent. It is self-evident that legal advice and the threat of litigation pre-empt social dislocation and ill-health which impose financial burdens on local government and the NHS. In its further work, the Commission would do well to carry out a thorough examination of the economic benefits of access to justice. Labour lawyers have long called for this to be done.

Bach rightly emphasises the potential benefits of technology in improving access to justice. The Ministry of Justice is already committed to substantial investment in an online court and undoubtedly much can be done to speed up and streamline court procedures and reduce costly hearings, but the report also points to evidence from the Legal Education Foundation that only 50% of those entitled to legal aid before 2013 would be willing and able to operate online. Experience teaches us that savings promised from technological advances do not always materialise. Nor can technology be relied on to replace live representation. The poor litigant dependant on a soulless computer screen is no match for the resourceful and determined human lawyer (or team of lawyers) wielded by his corporate adversary. 

Public cynicism about the lawyers’ gravy train is understandable, but the legal aid lawyers are not on board. 

The Legal Aid and Advice Act is, with the NHS, a pillar of the welfare state and a stellar achievement of the first government after the second world war. The annual cost of legal aid, was £2.1 billion in 2010 but is now £1.6 billion. Planned expenditure on the NHS in 2016/2017 is £120.6 billion having grown every year. Governments claim that is far greater than any other country spends on legal aid, but Bach shows that comparisons are misleading.

Why is legal aid so unfairly denied the funding it needs?

Of course doctors are more popular than lawyers, and ill-health may well be a more obviously pressing problem for more people than injustice is perceived to be. Governments are protected from criticism when they cut legal aid by the popular but false belief, fed by some elements in the media, that legal aid is little more than a gravy train for lawyers, who prosper at public expense.

The elephant in the room, which the Bach commission has so far ignored but needs to grapple with, is that there is indeed  immense prosperity in the legal profession. Public cynicism about the lawyers’ gravy train is understandable, but the legal aid lawyers are not on board. Those who ride the train are the commercial lawyers in and around the City of London. One example is Linklaters, one of the largest “magic circle” firms, which has recently reported profits for 2015/16 of £438 million. Of this sum, the 13 member executive board shares £19.6 million.   

Michael Gove, in his brief reign as Lord Chancellor, failed to persuade these lawyers to disgorge some of their excess profits in support of publicly funded legal services. He then bravely promised to impose a levy but failed to do so. His successor has so far remained silent on the subject.

A levy remains in my view fully justified, though it is of course true that the City lawyers are liable to tax at up to 45% of their high earnings. The Law Society’s March 2016 report on the “Economic Value of the Legal Services Sector” puts its value currently at £25.7 billion, a figure which had grown by £1.9 billion in 2014 - 15 alone. With or without a levy, the government could devote some of the tax paid by lawyers on this very large sum to improving legal aid.

My own career as a legal aid lawyer began in a mood of optimism in the 1950s. Witnessing growing inequality in access to justice in the subsequent half-century has been painful. The Bach commission needs to be bold if it is to produce a viable blueprint for a fair system of justice.

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