Legal Aid enquiry

01-02-2004

1. Citizens Advice are grateful for the opportunity to present evidence to the select Committee on this important subject. In support of our evidence, we would like to draw attention to the findings of our recently published Report: Geography of advice – An overview of challenges facing the Community Legal Service. This report contains a critical mass of evidence from CABx on a range of current issues facing publicly funded legal services, such as the growth of advice deserts.

2. We would also like to refer the Committee to research being published by the Legal Services Research Centre , which provides the best evidence to date on the scale of the need for legal advice, and the issues over which citizens require civil advice, assistance or representation.

Here we respond to the questions posed by the Committee.

What evidence is there of the emergence of 'advice deserts'?

3. There is very considerable evidence from the Legal Services Commission, Community Legal Service Partnerships and elsewhere of severe problems faced by the public in accessing publicly funded legal services. For the bulk of our evidence on the scale of this problem we would refer the committee to our Report ‘Geography of Advice.

4. For the sake of clarity, the problem of ‘advice deserts’ as we understand it, is the identification of distinct geographical areas or localities, where there is no supply at all of publicly funded legal services for eligible clients, or areas where the existing supply is manifestly and woefully insufficient, when measured against the scale of local needs. This can result either from insufficient funding for LSC contracts in particular areas of law, or from insufficient providers willing and available to take on publicly funded work. We suggest then as the basis of a working definition that an ‘advice desert’ exists if, at any time, there is not a sufficient number and spread of legal aid contracts to enable eligible clients to obtain access to a specialist supplier within a reasonable timescale.

5. The Geography of Advice report looks at these problems on a regional basis; here we explore further the issue of advice deserts by reference to the key categories of social welfare law and the ability of people with legal problems which broadly fall within these categories to obtain advice from a solicitor in private practice or an advice agency with a contract from the LSC. It should, however, be noted from the LSRC research mentioned above, that legal problems tend to occur within a cluster of broader social problems related to social exclusion, such as insufficiency of income, access to basic services, poor housing, disability, isolation and mental ill health – they do not always fit clearly into any one category of ‘Controlled Work’ under LSC contracts

(1) Housing - Citizens Advice research on housing advice, (Possession Action: the last resort? CAB evidence on court action by social landlords to recover rent arrears 2003) shows there is both a need for and value to preventative interventions to avoid repossessions, and resolve tenants’ rent arrears difficulties often caused by problems with the administration of housing benefit. Such interventions are cost effective as they avoid the additional public and social costs of homelessness, and local authorities having to exercise unnecessarily their duties to re-house homeless persons under the Housing Act 1998. We are not convinced that the current level of contracted supply is able to do this job effectively; for example:-

• In the South West there is only 1 contract in each of Bath and N E Somerset, North Somerset, and Swindon. There are only 2 contracts in each of: Somerset, and South Gloucestershire, and in the Bristol area there is – in practical terms – only one principal supplier (South West Law)
• In the North East neither Redcar nor Doncaster have CLS firms undertaking housing work, Pontefract & Castleford has only one housing solicitor and there are no solicitors offering publicly funded advice on housing law north of Newcastle.

Case Study – Housing: Appeals against Local Authority decisions on homeless applications

Stoke on Trent CAB recently advised two separate clients who had applied to the City Council for housing under the 1998 Housing Act as homeless people. In both cases they had been refused, gone through the internal review procedure, which had confirmed the original decision. In both cases they wished to exercise their right to appeal to the County Court. This is a relatively new phenomenon locally and the County Court has very little experience of these cases. Consequently, regardless of the capacity of the client to represent themselves in these circumstances the CAB believed that representation was essential, if only to assist the court in successfully adjudicating an unfamiliar matter.

In neither case was a solicitor available within the 21 day deadline. In the first case the CAB submitted the appeal paperwork, which was probably slightly beyond the scope of their contract, and made an appointment with the one local housing provider, once the appeal had been lodged. They then instructed a barrister who represented the client at the subsequent hearing.

In the second case the CAB approached the same solicitor who was unable to see them within the deadline, they could not find an alternative and we consulted the LSC Birmingham Regional Office. They advised that any solicitor could use their tolerance to advise the client. The CAB made referrals to two local firms both of whom agreed to make an appointment and then at the time of the appointment said they had run out of tolerance and were unable to help. The CAB contacted Shelter who suggested two solicitors in London and one in Birmingham, none of whom could deal with the case within the time scale. They contacted the LSC again and they the bureau permission to put in the appeal themselves, and then referred to the local supplier who saw the client prior to the hearing.

(2) Family – Family law advice services have to deal with the most stressful and personal/intimate issues in peoples lives, such as divorce and relationship breakdown, domestic violence, child-care and surrogate decision-making in cases of mental incapacity. Contentious divorce proceedings, for example, require a solicitor’s intervention and different solicitors are required for either party, so if both parties are eligible but there is only one supplier in the area, one party will not have local access to publicly funded services. Drafting and pleading an injunction in domestic violence cases are also specialised legal skills. Issues relating to child contact, adoption, fostering or children being taken into local authority care are also dealt with by solicitors.

However, family problems are often more of a combination of interrelated problems than one simple problem that can be quickly resolved. As a result they can be time consuming, and rarely fall within strict silos of narrow legal advice. Increasingly those with family problems are encouraged to use mediation; though most clients who use this service might only go to one session, there is still a need for them to be informed about their legal rights before they attend: the process should be an informed one with both parties understanding the framework within which negotiation takes place. Although the majority of civil contracts are in the field of family law; it is also the field in which there has been the highest rate of drop out by solicitors from public funding; and limited involvement from the NFP except with the FAInS initiative. Overall, supply is we believe that supply in this category insufficient, with advice deserts in some areas; for example

• in the East Region, 32 family law contracts were withdrawn or terminated, while only two new contracts were awarded over the past year.
• in the South East the number of contracts (is insufficient relative to population density, for example in Lewes there is only one family law contract.

(3) Immigration – Immigration and asylum advice concerns rights of residency and human rights issues with refugees fleeing genuine persecution. The private practice sector of the legal profession has simply not provided an adequate supply of proficient, scrupulous practitioners - a recent survey by the Legal Aid Practitioners Group found that one-third of law firms with an immigration contract are considering withdrawing from the field. There are also concerns - which we share - about the quality of the work done by some solicitors, and the legitimacy of the associated legal aid expenditure. Non-metropolitan areas frequently have a shortage of specialist immigration lawyers. To get a fair hearing, individuals need to be represented by a specialist who is aware of all of the options available to the individual. The result is that, in rural areas where the ethnic minority population is often lower than average, people already resident in the area and seeking permanent residence can face further discrimination owing to a lack of good advice. For example,

• in the Midlands the immigration contracts are all in the central urban area of the region including Wolverhampton, Walsall, Sandwell, Birmingham, Solihull, Coventry and Nuneaton with the exception of 2 contracts in Stoke-on-Trent.
• in the North West Blackpool, Cheshire, Cumbria, Halton, North West Lancashire, Warrington and Wigan have no immigration contracts
• in the North East there are no contracts in each of: County Durham, Gateshead, Northumberland, North Tyneside and South Tyneside and only 1 contract in each of: Darlington, Hartlepool, Redcar & Cleveland, Stockton, and Sunderland.

(4) Debt and Welfare Benefits – There is a supply and demand problem with debt and financial advice for low-income households generally. Over the last six years, Citizens Advice Bureaux UK wide have reported a substantial increase in the number of new debt enquiries. Notably there has been a marked growth in the number of new enquiries about consumer credit where enquiries have risen by 44 per cent over the six years to 2003. This growth has taken place during an economic boom, where low rates of unemployment, low interest rates and soaring house prices have fuelled a substantial increase in mortgage and consumer credit lending. Research conducted research for the DTI concluded that about a quarter of households (5.4 million households) reported that they had been in financial difficulties in the last 12 months, including 18 per cent who had been in arrears on one or more of their household commitments, and around two in ten (4.33 million households) were in financial difficulties at the time of the survey. Benefits advice is the other side of financial advice, where clients are unemployed or in low paid employment, or have an entitlement relating to their disability. Failure to obtain benefits results in genuine hardship, and general service delivery problems experienced by claimants are often exacerbated for clients who have a poor level of English language. Benefits advice is often extremely complex and involves specialist knowledge of social security legislation; we are not convinced that the current supply is adequate, for example:-

• in the South East there is a significant shortage of suppliers doing debt and welfare benefits work; for example in Surrey there is only one contract in debt work and one contract for welfare benefits work
• in the Midlands the following areas have no contracts North Shropshire, South Shropshire, Bridgnorth, South Staffordshire, Lichfield, Tamworth, North Warwickshire, Wyre Forest, Bromsgrove, Warwick, Wychavon, Stratford-on-Avon

(5) Employment Advice - We are concerned about the position in relation to legally aided advice in employment law as this is a vital area of social welfare law, which can play a major role in combating social exclusion. Representation at employment tribunals is not included within the legal aid scheme; this limits the extent to which LSC funded advisers can provide a full service to their clients. Secondly, many persons seeking employment advice are not financially eligible at that time, either because they are still in work or because they have a partner who is in work; this means that many people who are having trouble at work, such as facing disciplinary procedures or the threat of dismissal, are unable to obtain advice that might enable them to save their jobs, unless they happen to be members of trade unions. Thirdly employment rights are now a highly complex field, with a growth in self employment and the introduction of detailed new or forthcoming legislation on the minimum wage, working hours, discrimination, pensions and tax credits. Given this context we are not convinced that the apparent limited supply in this field is sufficient, for example

• in the West Midlands, there are only 9 employment contracts, all in the urban areas. There are no contracts in the western half of the region, nor the south-east or north west, except for one contract in Stoke; only 172 new matter starts in employment were awarded for the whole region - this suggests that the vast majority of the region is an ‘advice desert’ so far as employment law is concerned.
• in the South West There are no contracts in each of: North Somerset, Swindon, and Wiltshire; and only 1 contract in each of: Bath and N E Somerset, Dorset, and South Gloucestershire

(6) Community Care - Areas of social welfare law concerning the most vulnerable clients, such as mental health and community care law, attract virtually no public funding at all, despite their central importance to tackling social exclusion and human rights abuses. In relation to mental health law, there is a specific geographical issue in that most of the work relates to people who have been detained in mental hospitals and/or are appealing to a mental health review tribunal in relation to their detention. Since most clients by definition cannot travel to obtain legal advice, the issue is whether there are enough contracted suppliers within reasonable travelling distance of the hospitals in which people are detained. If that is not the case, then the hospital district (ie the area covered by the Strategic Health Authority) in question would arguably amount to an ‘advice desert’. Again the following illustrates the scale of the problem

• in the North East there is no contracted provision for Health and Community Care

Conclusions on advice deserts

6. In general terms, along with the Advice Services Alliance we would suggest that, in order to avoid the continued growth of ‘advice deserts’, there should be greater access to publicly funded legal advice services:

• at a local level in relation to family, housing, debt, benefits, employment and at both a generalist and specialist level so that range of clients problems – or problem clusters – can be tackled. (ie borough or district, to CLSP and LSC ‘bid zone’ areas)
• at a sub-regional or regional level in relation to the other main categories of contracted supply, which tend to require a higher level of expertise and specialisation – community care, education, public law, actions against the police, mental health, and clinical negligence.
• immigration law services either locally or sub-regionally, taking into account the effect of dispersal policy and location of detention centres as clearly the demand and need for immigration law advice varies between areas depending on the nature of the local population

What action is being taken to ensure that there is access to legally aided advice in all legal specialisms

7. The key purpose of establishing the Community Legal Service was to increase access to legally aided advice and widen the choice of suppliers, through local level action undertaken by Community Legal Services Partnerships. However, the evidence we have published in a Report Partnership Potential- CAB views of the Community Legal Service shows that CLSPs have generally been unsuccessful in levering in additional funds so as to increase access to legally aided advice either generally, or in relation to the areas of priority need identified by the CLSPs. This is one of the key issues being considered by the Review of the CLS, which is presently being conducted by Matrix consultants for the Department of Constitutional Affairs

How can the Department for Constitutional Affairs and the Legal Services Commission provide incentives for legal aid practitioners to continue legally aided work?

8. Getting the contracting/commissioning system right is key. Currently the LSC is operating an inflexible model of contracting that does not encourage or enable providers to develop an appropriate range of services in all areas suitable to clients needs. This concern is shared across the private practice and not for profit sectors; currently the Legal Services Commission contracts for the NfP sector have a number of unfairnesses and inflexibilities. These include inflexibility in claimable hours for ‘Controlled Work’, inflexibility in the types of work that can be claimed for and inflexibility in the funding formula relative to work undertaken.

9. The NfP contracts are based on hours per annum, per caseworker, rather than units of work, whilst the solicitor contracts are different, based on ‘matter starts’, which means in effect each contractor has a ration or quota of cases. The feasibility of achieving the target hours is affected by the extent to which contract compliance audits allow or disallow time actually spent by advisors helping clients. CABx may find it difficult to meet the hours because of local circumstances beyond their control, especially in areas of widely scattered need, for example in rural areas dealing with a smaller number of clients who have to travel long distances means more missed appointments, which it is not always possible to fill with other contracted work. Equally, cases undertaken by CABx may exceed time guidelines for good reason, such as clients’ vulnerability or special circumstances including mental health problems. However, there is no guarantee that the auditors may agree with CAB judgements sometimes hours the bureaux considered justifiable are retrospectively disallowed.

10. The new (April 2003) NfP contract enables the LSC to specify what is required to qualify as claimable ‘Controlled Work’ even more closely than in the past. All work claimed under the contract must be ‘’clearly justified and proportionately evidenced’’ on the relevant file, and agencies cannot claim for ‘‘work not directly involved in provision of legal services to clients’’, for example making up and routine updating of clients files and records, form filling on behalf of clients (eg personal bankruptcy forms), eligibility calculations, photocopying and typing. Legal Research is usually not claimable, unless it involves complex or recently altered points of law. For letter writing and telephone calls the standard claim is six minutes for a routine letter or phone call; perusal of incoming letters is generally not claimable, unless the letter is more complex/lengthy than a standard or routine letter. Travel time (eg to service outreach facilities) is not claimable. This level of detailed reporting and micromanagement on controlled work can undermine a caseworkers capacity to respond appropriately to the needs of individual clients in some cases.

11. The new NfP civil contracts do not provide for annual uprating of funding in line with the Retail Price Index. At the same time there has been no compulsory reduction in contracted hours to compensate; there is concern amongst bureaux that the long-term effect could be that contracts will become financially unviable. Unlike private solicitors, advice agencies cannot subsidise legal aid from private client work. They do not have large capital reserves to draw on, and they cannot raise bank loans. Bureaux are not able to use funding from other sources to subsidise legal aid contracts – it defeats the LSC’s aim that contracting should provide extra money for extra work. CABx have found it difficult to accommodate the lack of a cost of living adjustment in 2003-04, but the problem will be even worse in subsequent years if no increase is made. Assuming that the current rate of inflation continues, contract holders will be over six per cent worse off in real terms in 2005.

Is the perception that legal practitioners are moving out of legally aided work correct?

12. Yes, and the figures speak to themselves. Over the past 10 years, the number of solicitors with practising certificates has grown by over 52 per cent from 57,167 to 86,603, the number of legal aid firms has decreased from over 11,000 to 4,361. Publicly funded work in solicitors firms has been undergoing a long-term decline, but this has accelerated in the past three years; for example in family law there are now 3,392 solicitors firms undertaking publicly funded work compared with the 4,593 firms offered contracts when the Community Legal Service was launched. In their 2002 Annual Report the Legal Services Commission drew attention to this problem; ‘‘We are concerned about the changes we are seeing in the supplier base. Between March and April 2002, 6 per cent of CLS suppliers left, including some firms of good quality. We are picking up intelligence through our regional offices that up to 50 per cent of firms are seriously considering stopping or significantly reducing publicly funded work.’’

13. The Legal Services Commission’s report for 2002-2003 show that the total number of ‘’offices’’ with civil contracts (solicitors, and NfP agencies) at the end of March 2003 was 5,061 compared with 5,321 at the end of March 2002, a reduction of 5 per cent. The number of solicitors’ offices with contracts fell by 3.5 per cent from 4,543 as at 31 March 2002 to 4,383 as at 31 March 2003 which shows a slight ‘bottoming out’ from the declines of previous years. New ‘matter starts’ have fallen by approximately 31 per cent between May 2002 and May 2003; that is a third less of eligible clients being helped than in previous years - perhaps the strongest indication of a reduction on the number of people being helped through the Community Legal Service.

14. Civil litigation has been the frontline casualty, of the reduction in solicitor provision. Around 100,000 non-family civil legal aid certificates were issued in 1999/2000, whilst only 45,000 were issued in 2000/01, and in 2003 258 solicitors’ offices held contracts for ‘’Licensed Work only’’ (this relates to litigation work), a reduction of 34 per cent from the previous year. This can be explained by the exclusion of personal injury litigation from the funding code and the effect of the new civil procedure rules. However, there has also been an across the board reduction in the number of solicitors’ firms carrying out legally aided work; for example whilst in 1999/2000, 8,900 solicitors offices received at least some payments for family work, by March 2002 only 3,800 firms offered this service.

15. A Law Society survey of over 200 firms with LSC contracts, which found that for the majority of areas of work, decline is expected in the number of firms expecting to undertake work for legally aided clients in the future. A 49 per cent drop in the number of firms dealing with consumer problems and a 33 per cent drop in firms dealing with employment law is predicted.

16. In previous public statements, Citizens Advice have used the word ‘crisis’ to describe the current situation; we do not make this claim lightly – we believe it is supported by all the available evidence.

Can the requirement for legal aid be reduced by the resolution of some legal issues on a more informal basis, through the Citizens’ Advice Bureaux, long distance services or otherwise?

17. The Citizens Advice service is a key agency involved in helping people gain access to justice in today’s society. CAB services are provided from over 2000 outlets, and the CAB service deals with nearly six million new problems each year. 227 bureaux have contracts with the Legal Services Commission to provide publicly funded legal services and Legal Services Commission funding now accounts for 19 per cent of all CAB funds, so CABx are already undertaking a significant amount of legal aid work. The question therefore is whether work done by specialists under legal aid can instead be done by generalists including volunteers working in advice centres; this obviously depends on the profile of clients problems – whether they are especially legal rights problems or capable of resolution by some other means, such as ADR or more informal negotiations.

18. In broad terms this is consistent with the CAB problem-solving approach of seeking to resolve problems at the appropriate level, and wherever possible to identify preventative solutions. Problems need to be tackled as they present themselves in clients lives; whether as problem ‘clusters’ or manifestations of an underlying problem which could, for example be resolved through improving or changing policy and practice. Once these issues have been examined, action can then be taken to refer the client to the appropriate specialist service; however the client should also be able to access specialist services directly, so that multiple access points into the justice system are maintained. We do not favour a ‘gatekeepers’ role in accessing appropriate legal services. Inevitably this holistic approach has funding implications for the service. Citizens Advice Bureaux are independent charities, developed by and for the community; they are responsible for securing their own funds to continue to provide their service and have no statutory right to funding from any source. (CABx presently rely on the public sector for 89.2 per cent of their funds to enable them to operate).

19. However, on the specific issue of the generalist/specialist division, there is no hard evidence to suggest that any significant amount of work is currently being carried out under legal aid contracts, which could be better done by generalist advisers. There are also concerns about the quality or sufficiency of advice provided by non-specialists, which are borne out by a significant body of research, and under the current arrangements of contracts and partnerships there are concerns that referral arrangements are not working.

20. We therefore question whether a policy of transferring civil advice and assistance work from private practice solicitors to generalist advisors in the Not-For-Profit sector is the correct approach, not least because unlike solicitors Not-For-Profit advice agencies are unable to subsidise legal aid from private client work. There is also a potential danger for opening up a schism in the advice sector by contrast with advice agencies that are not serviced by solicitors, and of overburdening advice services by expecting them to be able to fulfil the requirements of legal aid work without the necessary resources.

21. What the Committee may want to look at more closely is what measures could be taken to encourage more lawyers to work in the NfP sector, and in the wider field of publicly funded legal services covering issues of social welfare law and combating social exclusion. Some of these issues are being considered by Sir David Clementi’s Review of Legal Services Regulation. The appropriate model to explore here multidisciplinary practice, or local/sub-regional consortia of service providers working to service level agreements.

22. We believe that it would be counter-productive to push all publicly funded work into the not for profit sector, thus overstretching its capacity. LSC funding to CABx for legal aid provision, whilst welcome, has had some unwanted connotations and consequences; contracts are only available in geographical and subject areas of “high demand” as designated by the LSC and provide funding only for clients eligible for legal aid. This is manageable as CABx are used to offering additional services, but there is a risk of diversion from clients whom are in equal need of help. Furthermore, the new contract contains onerous new conditions and CABx are concerned that there are real dangers of over-control reducing flexibility; it is this very flexibility for which CABx are valued.

What would be the comparative funding costs of a salaried service?

23. There is only limited research on how other models of funding and provision compare to the current approach of contracted services from a protected market of providers to a fully employed salaried service. However, two relevant pieces of work to consider are:-

• Moorhead Quality and Cost: Final Report on the Contracting of Civil, Non-Family Advice and Assistance Pilot, IALS (2001). This report assessed the block contracting of legal advice and assistance in civil, non-family cases and was submitted to the Legal Services Commission. It contains the most thorough assessment of legal advice and assistance ever undertaken, involving the use of experimental, randomised control and a number of innovative research methods to develop a full profile of advice and assistance work and the quality of service provided. Its particular focus is an examination of differences of approach between solicitors in private practice and "not for profit" agencies in the provision of social welfare law; the former tend to operate under the partnership principle whilst advice agencies employ dedicated advice workers to undertake contracted work. Comparing how solicitors and not for profit agencies work, it concluded that NfP agencies were more expensive per case and often took longer, however they provide a higher quality service and better outcomes for clients than other suppliers. The report also concluded that the additional time taken on cases reflected the profile of more vulnerable clients’, but that the methods of service and delivery used in the NfP sector gives clients added value and keep overheads to a minimum.
• Research carried out by the Lord Chancellor’s Department considered the merits of salaried service as distinct from client based and judicare schemes, on the basis international comparative research. Drawn from limited available costs data; this tends to show that salaried services are cheaper on a cost-per-case basis. For social welfare law, there is some (very limited) evidence to suggest that salaried lawyers are able to secure similar outcomes even though they spend less time per case. However, there is a danger with any salaried scheme that it can become overloaded, as staffing and resources fail to keep pace with increased demand; as a result, the quality of the service deteriorates. Staff may then become demoralised and leave, leading to further reductions in quality.

24. As regards looking at the cost of delivering a service in the context of England and Wales, we understand that the DCA commissioned study ‘review of supply, demand and purchasing arrangements’ in the private practice sector is near completion. A similar study into the ‘Cost of Contracting in the NfP Sector’ is being conducted by the LSC itself. This work will produce useful evidence, which will inform the debate about the future of publicly funded legal services, and the Committee may wish to consider the initial findings of these studies if available.

25. Inevitably, with proposed new funding and delivery models such as a salaried service or a civil legal aid contingency fund, the most pressing problem would be start up costs. There are also more fundamental concerns about the independence of a service that is employed directly by the state – effectively part of the wider Civil Service, but with a brief which includes enforcing citizens’ rights against the state. However, Citizens Advice agree with the proposition that LSC contracting, as it is presently operated, is not proving to be the most effective system either for users or providers, and that an alternative approach is needed.

26. A mixed economy of salaried practitioners and advisers, working flexibility and independently to tendered service level agreements, could provide such an alternative. This could be achieved through the development of networks or consortia of services from several different suppliers, all providing a basic generalist service, but with agreed division of labour for more specialist and advanced provision. Solicitors and barristers specialising in particular subjects should form part of the network. They would be in private practice, or attached to an advice centre, but would take referrals and provide second tier services across the network. Potentially this approach could integrate the current rather fragmented structure of contracts and partnerships.