Whatever else you might think of them, the Ministry of Justice are pretty good at political spin. All their announcements have been about saving money for the taxpayer. Given that most lawyers are taxpayers, it seems almost like they’re on our side. It’s only wastage that MOJ wants to cut. For reasons I’ve previously given, I don’t accept the MOJ case that this is about saving money.
However, there’s another point here. MOJ never says in its publicity anything which refers to the impact its policies have on people. Not the impact on clients, other people in the justice system, or on the many thousands of lawyers and their staff who will be made redundant, and have the businesses they’ve created destroyed. Exactly how would it feel to the partner in a medium-sized firm who has to break the news to 50 staff members that all of them are out of a job, as is she?
The human impact is hidden, However, I wanted to know how sizeable MOJ thinks the human impact is. After all, they must have thought about that. Only someone completely irresponsible and heartless would not have considered how many people would lose their jobs and what the effect of that would be.
Of course, that’s not relevant only in terms of common humanity. It’s also relevant from a financial point of view. MOJ says it is interested in saving money for the taxpayer. Well, tax income is part of that equation. Every staff member in a firm of solicitors, with the possible exception of a few low hours part-time staff, will pay Income Tax and National Insurance. The employer pays employers’ NI too. So too their various suppliers. The partners in law firms are taxed on their share of the profits of the firm. Banks get paid interest on their financing of the firm. Their landlord pays tax on the rental income. There are utility bills and other services.
In other words, there is an economic impact. A solicitors’ firm is a business putting money back into the Treasury’s bank account, and providing employment in a local area.
If the firm closes down, all of the above revenue is lost. And many or most of the staff employed by these firms go from being economically productive to potentially being benefit claimants. There are other consequences like mortgage repossessions.
So, I thought, if MOJ is really interested in saving money, they’ll have done these sums. They’ll have compared the amount of money paid out in legal aid with the amount of tax and NI revenue, and associated VAT, paid back to the Government. They’ll have looked at the net gains and losses. They’ll have considered how many firms might go under and how many people might lose their jobs. They’ll have considered how many of those are lawyers and how many are other kinds of staff. They’ll have done the economic sums and worked out what the impact of their policy is.
When I heard that the timetable for “consultation” on price competitive tendering was being accelerated, I lodged a Freedom of Information Act request with MOJ to ask about the human impact. What I asked was this:
‘Please provide answers to the following. The questions should be answered on the basis the MOJ’s proposed plans take effect unaltered from the original proposal which is to be put to consultation in April.
1. Has the Ministry of Justice (“MOJ”) conducted an impact assessment for the proposed plans for competitive tendering for publicly funded criminal defence services (“the Plans” and “the Services” respectively)?
2. Has MOJ conducted an equality impact assessment for the Plans for the Services?
3. How many solicitors’ firms does MOJ estimate will become insolvent and/or cease to practice criminal law if the Plans are implemented on MOJ’s preferred proposal?
4. In respect of 3 above, please specify many will withdraw from the sector and how many will become insolvent.
5. How many redundancies does MOJ anticipate will arise as a result of the Plans for the Services being implemented on MOJ’s preferred basis?
6. In respect of 5 above, how many redundancies are forecast to be in the following categories:
b) Support Staff
c) Associated industries, e.g. legal support companies such as providers of paralegal/police station staff,
office suppliers, enquiry agents.
7. How many barristers in independent practice does MOJ estimate will cease to practice criminal law if the Plans are implemented on MOJ’s preferred basis?
8. How many barristers’ chambers does MOJ estimate will close and/or cease to operate in crime as a result of MOJ’s Plans being implemented?’
I received the answer the other day.
Here’s the relevant section in full:
I can confirm that the department holds information that you have requested. The information is exempt under section 21 of the FOI Act because it is reasonably accessible to you, and I am pleased to inform you that you can access it via the following link [to consultation paper]. This consultation is a way for the Ministry of Justice to seek views on the proposals outlined in the consultation document and likely impacts of those proposals. Section 21 (1) of the Freedom of Information Act exempts disclosure of information that is reasonably accessible by other means, and the terms of the exemption mean that we do not have to consider whether or not it would be in the public interest for you to have the information.
So the MOJ says that the answers to my questions are in the green paper.
I accept of course that there are impact and equality assessments of sorts in the paper, but any statement at all of exactly how viable they think this is? How many firms will bid and how many can’t? How many providers will bid in more than one area? How many firms will go insolvent? How many job losses? I accept that the exact answers would be dependent on what happens in the tendering process, but they could estimate or give details of how they’ve considered this.
Those details are nowhere to be seen. The “answer” from MOJ is a total cop-out.
Needless to say, I have requested a review of the decision. Apparently they have two months to consider. In two months time, with the new shortened consultation timetable, the consultation period will be over. So MOJ have shut out any possibility of being able to refer to a FOI answer in response to the consultation.
There are three possible reasons for that. None of them are favourable. Perhaps MOJ simply does not know and has not thought about it. If that’s the case it means they are totally incompetent and moreover have not looked at the overall economic impact of their proposals. That harms their case for saying that this will save as much money as they allege. Perhaps MOJ do not care. That speaks for itself, and is unbelievably callous. Or perhaps MOJ do know the answers, have talked about them, and decided that job losses of these levels are acceptable, perhaps because we’re only lawyers (tell that to the conveyancing secretaries who lose their jobs too Mr Grayling). Maybe, as many of us suspect, this is not about saving money at all. It is about shutting down access to justice.
Whatever it is, MOJ does not want us to have the answers. It does not want an informed debate. It does not want the public to have the full picture and be able to understand what the policy does. One person’s cut is another person’s job. MOJ want the truth to be hidden and don’t want the two to be connected. It wants the truth to be hidden because the truth does not support its case. It wants the truth to be hidden because it wants to make policy based on spin rather than argument.
It is frightening that in a supposedly open, free and democratic society a Government department can act in this way, more or less with impunity.
And that is why lawyers, and the laws they deal with are so important.
I have now had the response to my offical FOI review request. Amongst other things, the answer from MOJ is this:
In relation to your Questions 3 to 8 which relate to insolvency of firms and redundancies, the answers to your questions are partly contained in the consultation paper and impact assessments but no statistical analysis on the impact of the proposals in terms of redundancies and/or insolvencies has yet been carried out. The Ministry of Justice does not hold the data required to conduct such an analysis. However, in accordance with usual consultation practice, we have invited respondents to the consultation to highlight which other factors we should take into consideration when conducting our final impact assessment based on the policy decisions made (including the final design of a competition model) and provide any necessary data to support such an assessment.
So it would appear that the answer is “we don’t know and we haven’t thought about it”.
How, if a Government is genuinely seeking to save money, is it possible to produce proposals and not reflect on what the consequences of those proposals will be? If the net saving is reduced or extinguished because of other systemic costs arising as a consequence, the aim of the policy will not be achieved.
This aspect of the plan is incompetence, pure and simple.
Mr Halloran at Lawtons Solicitors has done some more work on the figures.
To help him publicise the work I’m reproducing it in full below. The original can be seen here.
The amount spent on criminal legal is said to be over a billion pounds a year. It has been used in the Consultation document, accompanying press releases and articles by the Secretary of State.
A proper considered analysis of the figures reveal a different picture. The suggested spend figure for criminal work in the Consultation document is put at £1.109 billion.
These figures relate to work billed in the period 2011/12. As such, it relates to historic work billed in that financial year and does not provide an accurate spending figure for current rates. The point about this is that the reductions imposed since 2010 are not reflected in the published figures.
The up to date spending figure, we are told, will be provided prior to any bid round. They are in fact available as projected figures. The latest figures available are contained in the Business Plan for the Legal Aid Agency (LAA) published on 16 April. This will be subject to scrutiny from the Audit Office and is the first Business Plan from the LAA. These figures will be accurate.
The projected spend on criminal legal aid is £941 million for financial year 2013/14. The saving on the figures used in the consultation document is already £168 million.
The aim of the consultation is to achieve savings, from the criminal budget, of £220 million by 2018/19. If the correct figures are used the saving needed is £52 million.
The effect of previous reductions in scope are still being felt and will have an impact on the overall spend going forward. This is conceded in the LAA’s Business Plan.
The historic spending figures also reveal the extent of the cuts already imposed. A consultation document from the MoJ released in November 2010 (Proposals for Legal Aid Reform) provide the historic spending figures on criminal legal aid.
In real terms, allowing for inflation, the current projected spend is less than the spend on criminal legal aid in 1997/98, when the spend was £955 million (page 215). Even this figure is 3/4 years out of date.
The amount of legislative changes since 1997/98 have been significant and this has been a cost driver. The prison population in 1997 was (including those subject to a suspended prison sentence) 69,000. The prison population in 2011 was (again including those subject to a suspended prison sentence) 116,000. These figures are in a report published by the MoJ in 2013 entitled Story of the Prison Population in England & Wales 1993-2012.
Despite the increase in the complexity of the work we are being asked to deal with and the seriousness of the work, as judged by the substantial increase in the number of cases crossing the custody threshold, the efficiency of the legal aid system is evident.
The savings and efficiencies that are being asked of the legal profession have already been achieved and then some.