Meetings with the Lord Chancellor

Tonight representatives of local law societies are meeting with the Lord Chancellor, in the second of two meetings arranged by the Law Society.

As things stood last week, the proposed agenda for tonight’s session was as follows:

18:00 – 18:10 (10 mins) Introduction from Mr Grayling

18:10 – 18:25 (15 mins) – Economic realities currently facing criminal defence firms – in particular, what would it take for you to adapt from how you presently work and operate, to how MOJ intends. To what extent is this possible/desirable, particularly in the proposed timeframe and given the proposed cap on bids of 82.5% of current rates.

18:25 – 18:40 (15 mins) – Savings and efficiencies in the criminal legal aid system – the Ministry is clear that the savings must be made. Are there areas of the present system which could be more efficient, or where savings could be made?

18:40 – 18:55 (15 mins) – Practicalities of the proposals in Ch.4 of the consultation paper – Are there areas of the consultation that, in your view, raise particular issues. For example, the restriction on client choice, the size of the proposed geographical areas or the proposed limits on contract value?

18:55 – 19:00 (5 mins) – Closing remarks

There are elements of the agenda above which suggest that the profession might be willing to compromise on PCT if the details were right, although I’m informed by one of tonight’s participants that everyone attending is agreed that PCT is not acceptable. I’m sure all local representatives who took soundings will have been told that by their “constituents”.

While we wait for news of what happens tonight – probably not a climbdown by Mr Grayling given his comments in the Law Society Gazette this week  – I can provide some details of what took place in the meeting between Mr Grayling and criminal lawyers from a cross-section of firms last week. This is the most detailed note I’ve seen. Apologies to those who have already seen it (and apologies also for any typos).

CG – This is mostly designed to be a Q & A – none of us want to be in a position where we have to take tough financial decisions. The Spending Review for 2014 – 15 which is what we are talking about is going to create difficult decisions all over Whitehall. That is going to be our starting point. We consciously took a decision not to say less just to take a slice off everything. I didn’t think that was sensible. What I have tried to do is adopt a two layered strategy to the MOJ. We are seeking to put in place measures to reduce demand on the CJS to e.g. reduce the size of the Prison estate e.g. improving rehab of offenders and new ways of tagging, also looking ahead to further challenges without doing same things again and again. The reason we have gone down the route of PCT, it doesn’t mean no quality, I took the view that simply saying lets simply do a few cut. I think you can’t continue to do that and continue with the same paradigm, we live in a world where organisations are continuing to reduce their costs, this is a conscious decision to change which I think if the only logical course. This may mean you are going to have to redesign and engineer your business models, this may mean mergers and bigger firms, it does not mean giant forms, it may mean pooling back office costs, we are not asking you to do anything different to that which other players in the professional world aren’t doing continuously. On a quality point we have set ourselves a goal of a reduction in spend of 17.5%. In a tendering model it would be easy to say we will just go for who bids the cheapest, we are not going to do that. There will be an essential stage, a second stage, are those organisations capable of delivering a quality service. We will clearly ask those who bid to pass a quality threshold, I have asked LS and the Bar Council to assist, we could use peer review but I am not prejudicing. If got two organisations at table and equivalent quality will give to the cheapest. It does not mean a chase to the bottom. Does this mean Tesco Law, not going to stop anybody bidding but it seems that for some of the bigger providers we have unexpectedly set the bar too low. This does not mean 1600 people go up in a puff of smoke. The smart people will consider how can we meet this challenge. It is my hope that the wiser and smarter people will sit down and say how can we meet this challenge. The next thing to say is I have to meet the spending target. I do 4 things, Court, Legal Aid, Prison and Probation, non will end up with increased budgets, some will change and others will have to deliver significant reductions in budgets. I can’t change the big picture but I can listen on the detail. With Probation and consultation we have changed things following consultation. I am not coming to this that consultation is just a rubber stamping exercise. I am happy to listen and we will sit down and listen and try to come up with the best balanced package that I can. This is not a plan to destroy the Legal Aid industry, this is an attempt to deal with a harsh reality. This is not of my making but it is something I have to respond to. The Bar changes we have to applied change to top of income scale, speedier process, two Counsel, seems to me a set of principles that are sensible. The door is open for dialogue. I think we have come up with a package that is the best thing we have got.

Richard Atkinson:

I listen with Interest to your opening remarks. I say as a practitioner, a partner in a criminal practice, I don’t share your optimism on the proposals that are in the paper and so if they change significantly from the proposals that are in the consultation paper that will be vary welcomed. My concern is that those proposals that are in the paper will lead to exactly what you have said you do not want, that is not just the destruction of the Legal Aid industry, but to the Criminal justice, PCT has not been tested not been piloted (that is something that when in opposition the current Attorney General thought was essential so that a system could properly operate, we are well aware of the risks that tendering can bring from tenders elsewhere, not just in the CJS and frankly we have no confidence that the current proposals we lead know nothing other than the collapse of the whole system. I hear with interest your comments about quality, we do not see how quality can be maintained where client choice is denied, client choice is an essential element to maintaining standards, it is an essential element to our Criminal Justice System. If you take together the lack of client choice and the flattening of fees proposed so Solicitors are paid the same fee for a guilty plea case as they are for conducting a trial in the Magistrates’ Court then inevitably the market which is operated by business men, will tell you to try and get as many guilty pleas as possible, It will place us in conflict between our clients and our business interests, and to give you one example I know there it at least one parson around this table who has been figures it is simple not going to work for people to take on a 28 day trial at the flat fee being offered. It will inevitably impact on quality. The impact assessment of that has been prepared recognizes that and so we have real concerns of the impact on the British Justice System which is the foundation of so much that goes on in this country in other areas of the legal industry not just in Legal Aid. We have therefore real concerns that the proposals put forward will damage not just firms but the justice system itself, they are unworkable in their present-form and wilt remain so unless changed.

CG – so let me ask would you prefer if I cut everybody’s fees by 17,5%

RA – I would be happy to engage in discussion with you about alternative ways of dealing with the reforms that you have to make but that I want recognition that these proposals are no alternative to it. It is not a case of you can have this or that this is death and destruction to the CJS it is not an alternative to 17.5% cut, 25% cut or a 50% cut. It is no alternative at all. Yes we will engage in discussions, but only when it is recognized that this is totally disastrous.

CG – now look, you can’t say you will only engage in discussion if I recognize that I am proposing death and destruction. What you are saying is you are incapable of reorganizing in a way that brings down the costs to deliver the same service. Unlike almost any other industry in the country which is happy to do this day by day and week by week.

RA – I am not saying that and I do not want to dominate the discussions we only have an hour. I am very happy if you would like to meet we can talk but I can see hands raised.

Rachel Bentley:

I am a Duty Solicitor in Exeter area. What I can say is not intended to cut across other Firms or make a split between rural and urban because they have to speak for themselves. In Devon and Cornwall the proposals give us 10 contracts across the peninsula, we would not be able to comply with PCT we are very clear about that, with the best will in the world even if we believed in the principle, which we don’t, we could not comply. The logistics of getting a solicitor from North Devon to Cornwall which can be a 3 hour drive in the summer, it doesn’t work. If we try to amalgamate and I can understand why you would say that, the difficulty is, if I go to my bank manager and say my work volume is falling, so is my colleagues in Cornwall, we are told by the government that we have to join up to try to make this work, he is not going to lend me money to invest in the sort of infrastructure that this proposal requires, so we feel trapped, we can’t comply even if we wanted to.

James Subbiani

I am a solicitor from vary rural west Wales. I find the suggestion that we are unable to deal with challenges that face us and cuts in rates offensive, there hasn’t been an increase in rates for 20 years, in fact in real terms the rates have fallen by about 45% in 20 years in the last 3 years because of cuts that have already been implemented the rates have been taken down by about 20 % in the last 3 years as far as my Firm is concerned and to suggest we should re-organize to face a further 17.5% cut is offensive to the business realities that we are dealing with at the moment. We have already had cuts thrust upon us that seem to have been ignored, they are been massive so that my margins in my Firm are way way below 17.5%, in my business which is a 21st century business, we have geared up, you say that larger Firms have had the rug taken from under them, because they are already doing more than what’s on offer, I currently do 45% of the work in Pembrokeshire, 20% of the work in Dyfed Powys, concentrated in . Pembrokeshire and Carmarthernshire, the work on offer in my procurement area is 25 % of the work in Dyfed Powys I would have to cover four times the geography, for an additional 5% of market share which I have already got concentrated in a small area, I find the suggestion that we can’t arrange ourselves offensive.

CG – I think you can arrange yourselves, I think you are suggesting that you can’t. I am not making the suggestion that you can’t.

JS – we can’t, if you have ever been to an area such as rural West Wales, these just do not work, it cannot, nobody can make them work.

Sundeep Bhatia:

I have a mandate on behalf of BME firms. (hands in a letter), I and my colleagues are extremely worried on the effects on diversity both within the profession and outside of it. Many BME Firms have sprung up to serve communities and have knowledge of their background and their circumstances, through those Firms they receive justice through the Advocates that represent them in Court and it is healthy for society, many of those Firms are small, more than half of five partners or less. My fear is that those communities will suffer as a result. I also fear diversity in the profession will be decimated, I would ask you to consider the effect this will have on diversity.

Diana Paine from Blackfords:

I am a partner in one of the larger Firms that undertakes Criminal Legal Aid work. I have looked at it and it is unworkable. I say that to you as a business woman, not as a lawyer, as a business woman. It is utterly unworkable. If I say that as a business woman then it must impact upon me as a lawyer and I say this to you, , that if it is economically unsustainable, the talent will go from my Firm, when the talent goes the quality will go. The Criminal Legal Aid System is one of the beacons of our society, it will be irretrievably extinguished if PCT goes through, so whilst you say it is both logical and sensible, it may seem logical to you but I would strongly suggest it is not sensible.

CG – So what do you think I should do instead?

DP – I have no alternatives at this stage for the very reason that we have this crushing obstacle in the way affecting the viability of my practice, this three letter word called PCT that needs to be dealt with before we can go on and have further sensible discussions with you.

CG – that doesn’t really work. What you are saying to me is I come up with an alternative. You won’t come up with an alternative unless I accept mine is

DP – I echo what Richard has said, I don’t think that is the purpose of my words to you no, what the purpose of my words to you is for you to understand from a Firm that is run deeply efficiently, survive on the threshold of survivability by being deeply efficient in our house keeping the way that we do that, but if we can’t get past that I can’t go on to consider anything else.

Tony Hines:

Spoke about his Firm in West London and Thames Valley covering large area, but procurement areas and caps on volume meant the proposals could not work for him. Said he felt that there should be minimum contract size and the BME Firms should be protected. Hines also spoke about stupid procurement rules. Existing duty schemes should remain but bottom 30 % of market share should be eliminated.

CG – so is the problem about the nature of the geographic areas?

CG – I am here to listen, I am asking you what works.

CG – one of the reasons that the question has been asked of choice, and one of the reasons that we have gone down the road of saying individual can’t choose is so that we can guarantee volume, my expectations that if you get a repeat offender they would be reallocated to the same Firm unless there was a good reason not to. This is something I am happy to discuss.

Adam Makepeace:

Talked about the difficulty in setting quality standards and that it would be a race to the bottom on bids, once through PQQ it will be the lowest bid. We do want to engage for the alternative, but we do want to see the race to the bottom removed from the dialogue.

CG – the race to the bottom has never been in the dialogue in the first place. Would not automatically take the lowest bid. If you have some bidding a lot lower you will want to know why. Once the level of saving I am trying to achieve has been achieved it is quality that I want so if we have a Firm 1% lower than competitor of comparable quality will go with 1% lower, if 15% lower I would be deeply concerned.

Ash Bhatia:

There Is unprecedented opposition from Solicitors and Bar because it is not a real competition, It is simply an opportunity, there is no certainty in the contract, the notion of bidding on price is an anathema, an illusion, there is no guarantee on numbers there is an absence of certainty and you can’t offer it. It is a pity that you do not do joined up policy with HO, a whole system approach. PCT will be unsustainable.

CG – there is no certainty now as crime rates falling. We can map out best estimates and give you as much certainty as possible, we have removed choice for the accused to give as much guarantee of volume.

AB – as things are today there is no certainty but I am not facing a guillotine.

CG – look, I go back, it would b easier for me to say, let’s have a big fee cut, I don’t think that is the most sensible way of addressing this challenge. I throw down the gauntlet to the industry over the next 18 months, re-engineer the way you work, in a way that enables us to bring costs down, so I am not saying to 1600 Firms here is a fee cut. Am I wrong.

Lots of yes

CG – so would you like me to say I would cut fees by 17.5%?

Lots of no

One lawyer said that with 15 minutes to go it is not possible to talk about the alternatives. Proposals in paper won’t work in practice.

CG – the whole point of doing this is that is it s a consultation and you can say what will work and what won’t work. I said at the start that I am open to looking in detail of the proposal, what you are all saying is you don’t want me to so what I am proposing but you don’t want me to do the alternative.

We will engage you about the alternatives but that is not the occasion.

JS – you have not consulted on the alternative, the consultation paper makes it clear that this is not a consultation on the principle of PCT but on the mechanism, not alternatives to PCT, we are saying PCT doesn’t work, we will engage with you as a profession and professional bodies. I sit on the CLSA committee, there are lots and lots of ideas out there as to where savings can be garnered in the Criminal Justice System and with regards to Legal Aid, injecting fresh streams of revenue into Legal Aid, what cannot work is PCT, your consultation is its PCT and how PCT will work, nowhere does it say would you prefer to have a 17.5% cut.

Simon from small Criminal Firm in Norwich:

1. You have an awful lot of money to save. We all have our views but that is not going to change.

2. PCT is loathed by every member of the profession, the Bar and I suspect the judiciary. You have managed to come up with this PCT idea which

CG – I haven’t come up with it, this is an idea that has been on the table for about ten years.

Simon – no pay rise for 20 odd years and we are still running our businesses, the problem with the concept of quality is this (example of failed tender for VOSA pros works determined purely on price).

CG – I am giving you a clear on the record for assurance that that is not my intention on how we will do this.

Joy Merriam:

I wonder whether seen a Statement issued today, joint statement all agree one of things unanimous opposition to is removal of client choice to guarantee numbers, we find the concept that these vulnerable people being reduced to numbers somewhat disturbing, I will briefly explain why it will not work, the removal of choice, quality will go down the toilet, if you are guaranteed the work, they don’t want you next time – tough – They are with you for the next 3 years. You think it doesn’t matter but you will get lots of miscarriages of justice

CG – I think it would be a lousy business model and you would not get a new contract and would fall foul of quality checks.

JM- three years down the line – we all agree that quality will be affected. We all agree that you don’t appreciate the efficiencies that we bring to the system, by a Solicitor knowing a Client over a number of years and how that affects the system, it has been touched on by Sundeep, Clients will accept advice from a Lawyer they know, cases dealt with efficiently and speedily which will be lost with removal of Client choice.

CG – but won’t be able to guarantee volumes.

JM – we don’t think you can anyway. Lots of variables. If you try to force a Client on a Solicitor on who they have no confidence they won’t do it. It’s like me as a Sheffield United supporter being told to support Wednesday. I won’t do it, they will represent themselves, will end up with had affect on Court Service, we say removal of Client choice, apart from the ethical and moral reasons, we say it won’t deliver the savings you think.

Nina:

(echo removal of Client choice will reduce Client choice)

CG – we aren’t saying a person will get passed around from Firm to Firm.

Lots of yes you are

CG – the norm would be that someone would return to the same Firm, but if we don’t have a mechanism to deliver volume, but we will listen to alternatives.

Bill Waddington:

Chair of CLSA – this is not just my view but from information fed to CLSA on a daily basis. You say you have not gone for administrative cuts but you invite us to participate in a tendering process at 17.5% less than charging at present time, you mention about PCT not being a race to the bottom, I am quite sure that when ALS won the interpreting tender they did not expect that to be a race to the bottom but it was and the tax payer is picking the bill for that.

CG – it is important to say that the tax payer is saving a lot of money as a result of that contract. And mistakes were made in the contract that we need to make sure are not repeated. I can only it is not my intention that this should be an exercise in price.

BW – James said he was offended, I am quite sure that you did not intent to offend anyone, but you did say that the wiser and smarter would be talking and planning to make it work, that does imply to my membership that they are neither wise nor smart as non of them can see how it can work.

CG – I do not believe that it is the case that no one is looking at the future, and how to make it work, I think people will bid, I will listen and what is as good as possible be. If someone has a letter idea in consultation we will look at it engaging with professions.

Take PCT off the table and we will engage.

CG – it’s not a case of taking PCT off the table – if no one comes back with a counter proposal.

There is a minimum I need to achieve, below that there will be a focus on quality, this is not about me wanting as much money as possible.

Ian Kelcy:

Not going to reiterate what joy said about Client choice, I will make a point about victims who will be cross examined but litigants in person, also the time frames are totally unachievable. I make no apology, firms are not structure to make the changes in the time frames proposed Firms will go out of business and you will be left be the next election with a CJS that has crumbled.

CG – we are talking about 18 months period.

RA – no you are not, no one will implement until they know that they have a contract so it is three months.

JS – Minister, if we are right and you are wrong what then?

The note I have ends rather abruptly there. Rather poignant though.

Let’s see what comes out of tonight’s meeting.

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