Reforming Legal Services

legal services reform

A 340-page report, Reforming legal services: Regulation beyond the echo chambers, conducted by Stephen Mayson, honorary professor of law at University College London, has been published this month.  It follows a review, established in July 2018, and draws on the work of the six working papers, an interim report and the reactions and responses to them.

The report concludes that the regulatory framework for lawyers needs better to reflect “the legitimate needs and expectations of the more than 90% of the population for whom it is not currently designed” and calls for, amongst other things, a single, sector-wide regulator of all legal providers and a single point of entry for consumer complaints.

The report, which has been submitted to the Lord Chancellor, reflects meetings with more than 340 interested parties including current and former regulators in the legal sector and beyond, professional bodies, consumers and consumer bodies, unregulated providers and their representative bodies, senior judges, practitioners and in-house lawyers, academics, and Parliamentarians.

The report points out that the current arrangement of ten front-line regulators, plus an oversight regulator (the Legal Services Board), is not only cumbersome but does not allow consumers or society to benefit from the full range of provision and protection they deserve. This arises from the ‘all or nothing’ effect and cost of legally-qualified practitioners being regulated for everything they might conceivably do, while otherwise capable, but ‘unregulated’, providers are excluded.

With this in mind, the report proposes that in future all providers of legal services, whether legally qualified or not, should be registered and regulated. Moreover, their registration and regulation should be the responsibility of a single, sector-wide, regulator so as to ensure a common, consistent and cost-effective approach, subject to a statutory duty to apply only the minimum necessary regulation.

Professor Mayson said that the time had come to move from regulating lawyers to regulating legal services, but to differing degrees depending on the risk to the public interest of the work with the result that a qualification should no longer be the sole route into becoming a regulated provider.

Inevitably, Professor Mayson’s conclusion have drawn a mixed response from existing regulators.

The Council for Licensed Conveyancers stated in their response of 11 June that:

“Stretching a single regulatory framework across the full range of legal services is not an obvious solution to the needs of a dynamic legal sector. Our approach to having different levels of qualification, cited in the report, shows the benefit of a diversity of approaches by different regulators so allowing innovative solutions to develop.

“We continue to believe that our specialist approach is the right way to deliver consumer protection while fostering the development of innovative and vibrant conveyancing and probate businesses.”

The Chartered Institute of Legal Executives (CILEx), however, took a far more positive view.  Professor Chris Bones, the chair of CILEx, said:

“Through a carefully calibrated blend of work experience and education CILEx is creating lawyers fit for practice in the 21st century. CILEx rejects the narrow sectional interest that has stood in the way of badly needed changes to the regulation of legal practitioners. The measures included in this report that will protect consumers, open the market further to full competition and ensure that legal services as an industry remains a competitive sector for the UK, are all welcomed by CILEx and by CILEx lawyers”.

He went on to state:

“Professor Mayson is also right to call out the unsustainable position of having organisations that both regulate and represent their parts of the profession. The current separation of functions does not go far enough and CILEx has consistently advocated a greater degree of regulatory independence than currently permitted by law. I hope his recommendations spark action on this front sooner rather than later”.

The Law Society of England and Wales took the view that recovery, not more regulatory reform, should be at the heart of its efforts in the wake of COVID-19 when it comes to legal services. Law Society president Simon Davis said:

“… the immediate focus of policy makers should be thinking about how to make better use of the current regulatory framework, deliver effective public legal education, resource legal aid properly and ensure the survival of the vulnerable parts of legal services that do so much to support people in difficult circumstances and to underpin a whole range of transactions, business and personal.

“Rather than diverting time and resource to analysing our regulatory frameworks, policy makers’ efforts should be directed at:

  • funding legal aid properly to ensure that everyone – not just the well-resourced – can access justice;
  • restoring trust in the crumbling criminal justice system; and
  • getting the court system and the economy up and running, ensuring that well-run firms do not go under as a result of Covid-19 – 71% of high-street firms are currently under threat.”

Given the current problems being faced by law firms of all types following the COVID-19 outbreak, it looks likely that any issues arising from this report are not going to be high up the political agenda. Only as recently as 18 May, Justice Minister Alex Chalk responded to a question from Craig Whittaker, MP for Calder Valley asking whether his Department had plans to review the Legal Services Act 2007 and Legal Services Board’s oversight of the Solicitors Regulation Authority and other regulatory bodies. He stated that:

“There are no plans to review the Legal Services Act 2007. Arm’s Length Bodies of the Ministry of Justice are subject to a regular cycle of reviews as part of the Cabinet Office Tailored Review programme. A Tailored Review of the LSB was published in July 2017 which found that the LSB is generally effective both in promoting the regulatory objectives set out in the Legal Services Act and in delivering its functions”.

Whatever the outcome, the future for those providing reserved legal services is unlikely to change much in the next few years and, given a low appetite for change on the part of those currently involved in regulation and the slow uptake so far of new forms of practice, the legal landscape is likely to be set in its current form for some time to come.

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