It is difficult to have any faith in this consultation being a genuine consultation process given the history that the MOJ has of ignoring consultation responses and the fact that the Contract is due for implementation only a week after the closing date of the consultation. The consultation is also a sham as it seeks to force a choice between the ways in which a cut should be implemented and not whether the cut should be implemented.
It is quite clear that this cut is unnecessary and no attempt to dress it up as financial expediency will work when one actually looks at the figures involved. When the MOJ started on this crusade in April 2013, the aim was to knock £220 million form the then £1.08 billion criminal legal aid budget by 2018/19. The target was therefore £860 million. The latest figures from the LAA for the 12 months to the end of September show that the overall spend on criminal legal aid is already below that target figure by the third quarter of 2016, almost two years ahead of target. The spend for that twelve months was £856 million.
The profession has been telling Government for years that volume in criminal legal aid is falling and the recent Oxford Economics report once again confirms that to be the case. Falling volume will continue and will continue to bring about falling costs. There is no financial justification for any further cuts in legal aid and the Government is well aware that the profession is too fragile to withstand any further cuts. Cuts were predicated on increased volume for suppliers but this has not happened and cuts alone are not sustainable as the Government’s own experts confirm.
We were promised a review before consideration of the re-implementation of the second 8.75% cut. We are not aware of any such published review.
LGFS cut to Page Count proxy
What is the rationale for the LGFS proposed cut on PPE? We are told it is short term pressure on the budget as a result of the costs case of Napper. All Napper did was to ensure that solicitors were actually paid properly under the scheme that the Government introduced and that the Government was not mis-interpreting the payment rules. If the Government did not like the decision in napper it was incumbent on them to appeal it which they did not do. It is not appropriate to change the payment structure to rob solicitors of a fair payment for the work they undertake on complex cases which includes the time that is necessary to take instructions from clients, consider the evidence and the unused which tends to increase in proportion with the page count of the evidence.
It is true that in the LGFS there was a slight increase in fees from 2013/14 to 2105/16. However that increase is now reversed and the figures for the twelve months to September 2016 show the LGFS at £323m and therefore down from £341 million in 2015/16. However, what is dishonest in the Government’s approach is the failure to take account of the dramatic drop in VHCC payments. It is our direct experience over the last four years or so that many cases that qualify as VHCC cases have been accepted as qualifying but have been paid under the LGFS scheme. Moving cases from VHCC to LGFS has led to a dramatic drop on the VHCC payments and unsurprisingly an increase in LGFS payments. It is also the cases with more high page count that will have been subject to the VHCC regime in the first place and are therefore being moved into the LGFS. Of course you will see an increase in high page count LGFS cases if you move them from the VHCC regime to the LGFS structure. This has nothing to do with Napper.
It is important to look at the figures overall and one can see that the slight increase in 2015/16 can be considered to be a short term increase that has already been reversed.
The total VHCC and LGFS figures are as follows:
Year to 30/9/16 £350m (projected to be £342m for the financial year 2016/17)
There is no financial case for the cut to LGFS.
Changing the payment rate for court appointed cases will mean that such cases are not adequately remunerated. The current fees are set based on an accepted cost of time and it is lamentable that legal aid underlying hourly rates are so miserable in comparison. It is a reflection on the paucity of legal aid rates eroded as they have been over time with no increase for two decades and further eroded by inflation.
As an indication of the erosion of rates and the stagnancy involved it is instructive to understand that the rate underlying Crown Court claims (and the rate payable on special preparation) from 1996 is twice the proposed rate adjusted for inflation to 2014 (note not 2017). As an example, a grade A fee earner in 1996 would have received £55.75 per hour (wuth the option of 100% uplift or 200% on serious fraud cases). Adjusted for inflation this equates to £91.32 in 2014. The current actual rate paid for special preparation is £50.87, a real cut of 38.95% and the proposed rate will be £45.99 which is a real cut of 49.64%, or almost exactly half of what the rate from two decades ago was worth in 2014.
Payment for court appointees is “to cover the proper fee or costs of a person appointed by the Crown Court under section 4A of the Criminal Procedure (Insanity) Act 1964 to put the case for the defence” and “to cover the proper fee or costs of a legal representative appointed under section 38(4) of the Youth Justice and Criminal Evidence Act 1999 (defence representation for purposes of cross-examination)”. We emphasise “the proper fee”. Legal aid rates are not a “proper fee”. This is not easy work and should not be cut back to legal aid rates when most firms would undoubtedly refuse such appointments subject to professional obligations. We say this fully aware of clause 10.15 in the new Contract which we consider to be ultra vires in any event.
Our firm has been established for 17 years and has been rated in the Legal 500 and Chambers and Partners as one of the top tier criminal firms in London throughout that time. We are a vital resource for those accused of crime from the largely deprived areas of south west London. We also specialise in assisting victims of human trafficking with approximately 70 such clients currently with cases ongoing at the moment. These cuts will put the sustainability of our practice at risk in terms of continuing with legal aid work at the current level. If it puts the sustainability of legal aid work within our practice at risk, it will do the same for a large number of firms across London and across the country.
In summary, neither cut is acceptable or necessary. The target for spend on criminal legal aid have been exceeded two years ahead of time and the volume and levels of payment remain in decline despite a slight increase in LGFS payments in 2015/16 due not to Napper but to the continued movement of cases from VHCC to LGFS.
23rd March 2017