It is a pleasure to talk about an issue that is of great concern to my constituents and all those who are concerned about a fair and decent society: the impact of legal aid reform. I am not a lawyer and, unlike the Minister, I do not claim to be an expert on the intricacies of legal aid. However, I plan to use the debate to discuss the impact of the Government’s reform of the legal aid system on Beverley and Holderness, which is a rural area with an older than average population and several pockets of severe social and economic deprivation.
Everyone agrees that in a free and democratic society, people should be entitled to legal representation. In January, the Lord Chancellor used a speech to the Law Society to say:
“free access to justice for those who need legal aid is as integral to the welfare state as the NHS or state education.”
The Minister has herself said:
“The hallmark of a decent society is good legal advice and representation for the community.”—[Official Report, 6 March 2007; Vol. 457, c. 1379.]
Since 1997, the cost of legal aid has increased from £1.5 billion to £2.1 billion. That sounds like a large increase, but when the figure is adjusted to reflect today’s prices, it is in fact a small one. On today’s prices, the 1997 budget was just over £2 billion compared with £2.1 billion today. England and Wales spend more on legal aid per capita than anywhere else in the world, and the cost to each taxpayer is nearly £100 a year. We, as a country, should be proud of that and of our determination that people should have access to legal support regardless of their income.
More than 3,000 additional criminal offences have been created since 1997. In a previous Adjournment debate, the Minister—before she was in her current position—highlighted the impact of the Government’s policy on the need for legal aid and support. Population increases, unprecedented large-scale immigration and increased levels of family breakdown have all placed pressure on the system but, as I have said, the amount spent on legal aid has not really increased by much above the rate of inflation.
Let me turn to the history of legal aid budgets. Twenty years ago, in 1987-88, the expenditure on legal aid at 2005-06 prices was £836 million. Ten years ago, the expenditure was £2.016 billion and, as I have said, in 2005-06 it was £2.1 billion. However, since 1997, the NHS has had a 100 per cent. increase in expenditure, funding for education and training has increased by 80 per cent. and total Government expenditure on public services has increased by nearly 60 per cent. Access to legal aid, which is a fundamental pillar of a civilised society, has not increased comparatively.
It is important to recognise that there has not been an increase in expenditure on all aspects of criminal legal aid. The LECG study of Lord Carter’s proposals, which was commissioned by the Law Society, states:
“in the past three years, 2002-2006, costs in most areas of criminal and civil work have increased only slowly if at all, and, on a per case basis have often decreased. During 2002-2006 total legal aid cash payments have risen at a rate of 2.1 per cent. per year. Within the CLS (Community Legal Service) payments have risen at 0.7 per cent. per year and lower CDS (Community Defence Service) payments (excluding crown court) have fallen at -1.6 per cent. Within lower CDS, police station attendance costs have risen at an average 4.4 per cent. per year, but adjusted for higher case loads risen only at 0.4 per cent. per year. Magistrates’ court costs have fallen by 0.1 per cent. per year and per case by 0.5 per cent.”
I have cited a number of percentages to show that criminal legal aid, especially in the lower courts, has not experienced an explosion in costs. In those terms, we have no problem for which we need to find a solution.
A recent report from the Select Committee on Constitutional Affairs concluded:
“it is clear that the Government has been unwise in attempting to reform the entire system rather than in concentrating on those areas which cause the problem: Crown Court and public children cases.”
That is important in the context of my local area. In Kingston upon Hull there are eight firms that undertake publicly-funded criminal defence work, but there are none in Beverley. Although based in the centre of Kingston upon Hull, firms have historically covered magistrates courts and police stations in several towns across the East Riding of Yorkshire, including Beverley, Bridlington, Goole, Driffield, Hornsea, Withernsea and further afield. Last year, more than 8,000 people in Hull and the East Riding received help through legal aid.
Firms in Hull have fiercely opposed the Government’s proposals to introduce fixed fees and to abolish travel and waiting time payments. People in those firms are committed to providing legally-aided support to the poorest and most vulnerable in our society. As colleagues mentioned in a debate in January, such people pursue their work out of conviction, rather than in pursuit of profit. They began striking in December last year and staged the third in a series of two-day strikes in February. They did so because Hull has been declared an urban area by the Government. The Government have designated 16 urban areas in which solicitors can no longer charge for travel and waiting time. That has had an impact on out-of-town courts such as those at Beverley, Goole and Bridlington. To put it simply, why would a firm pay to travel to a small provincial town to represent a defendant when it could earn exactly the same money by attending a local court?
Was the hon. Gentleman as surprised as me to see that Kingston upon Hull was classified as an urban area when other parts of the country, such as Norwich, Middlesbrough and Doncaster, were not? That worries me slightly.
The hon. Lady is right to be worried about that unfairness, which is the main focus of my remarks and something to which I hope that the Minister will respond. Solicitors from Hull who come out to service the magistrates court at Beverley and look after people from throughout my constituency are not paid to wait, even though a case programmed for an 11 o’clock start at Beverley magistrates court will often not actually start until 2 pm. They are not paid for travelling, and if they arrive at 11 am and the case does not start until 2 pm, it is not worth returning to Hull to go back to the office. Those people thus sit around and are not paid for waiting or travelling.
The Minister shakes her head, yet because Hull lawyers have withdrawn their services from Beverley, two firms from Scarborough and one from Bridlington are travelling down at public cost—I think that they are paid £26 an hour. On Friday night, it took me one hour and 45 minutes to make a return journey to Scarborough. Those solicitors are being paid to travel and, in the circumstances that I mentioned, are sitting around from 11 am to 2 pm before the case is heard. They are being paid to wait, yet solicitors from Hull are not. I put it to the Minister that that is unfair.
The hon. Gentleman is completely wrong; solicitors are paid for their travel and for waiting. One third of that element has been removed, but, none the less, they have achieved a 2 per cent. pay rise on the assumption that they go to Beverley. Actually, solicitors are not going to Beverley; they are grasping a much bigger pay rise by avoiding that obligation.
Despite her commitment on the issue, the Minister displays a characteristic harshness towards those firms. Of course, she has practised at the Bar and is used to greater remuneration than that received by criminal defence solicitors based in Hull. Those people are, as I have said, committed to the service of those in the community who need legal defence. However, as a result of the changes, they have lost 20 per cent. of their business, so when we consider the effect of fixed fees, the idea that an increase of 2 per cent. in the average that they are paid represents a big rise is entirely false. I hope that the Minister will take that comment back and apologise to the people in those firms in Hull.
This year, by the Legal Services Commission’s own figures, Hull solicitors were expected to take on the same work load as last year, but for £30,000 less. I ask the Minister whether anyone trying to run a commercial practice would do that.
I have no intention of apologising for giving people a pay rise. The hon. Gentleman needs to understand—I am not sure that he does—that two thirds of the travel and waiting payments have been rolled into the fixed fee on the assumption that those solicitors would do Hull and Beverley, as they always have. If they do not go to Beverley, they will get a far bigger increase than 2 per cent. because the fees include travel to Beverley. Instead of taking any travel time to go there, they will walk from their city centre offices to Hull court and pocket the money for travel to Beverley without ever going there. I think that that results in an increase that is far more than 2 per cent.
Obviously the Minister is infinitely more familiar with the detail of this landscape than I am, but it seems to me that when people do not go to Beverley and thus do not pick up a fee—I believe that such fees represent about 20 per cent. of their income—they can hardly be considered to be pocketing a pay rise. Those changes have caused Hull-based firms financial and professional difficulties. As one firm put it:
“Solicitors do not jettison clients that have sometimes been represented by their firm over many years without trepidation and crisis of conscience.”
It is beneath the Minister to suggest that they are fat-cat lawyers who are going for a money grab. That is not the right approach to the issue, which is why the hon. Member for Kingston upon Hull, North (Ms Johnson) and many other Labour Members questioned the Government’s approach during January’s debate. The Minister’s harshness of tone when dealing with those who are trying to provide services of great importance is inappropriate.
The eight firms to which I referred have fiercely opposed the locality being declared an urban area. They concluded that it no longer made economic sense to represent publicly-funded clients in Beverley, Goole and Bridlington and thus gave notice to Her Majesty’s Courts Service that they would no longer provide duty solicitor services for courts based outside Hull or take on new cases. That came into effect on 16 April 2007.
The situation has created a dilemma for the Legal Services Commission, which has a statutory duty to ensure the availability of legal advice. It wrote to firms in Scarborough, York, Doncaster, Scunthorpe and Grimsby to ask for their help. When that provided limited assistance only at Beverley, it had to arrange for the public defender service at Darlington to attend, although Darlington is more than 90 miles away. When pressed, the regional director of the LSC would not reveal how much the service had been paid.
A rota for the whole of June has been put in place. Three firms—one from Bridlington and two from Scarborough—are being used and the LSC is in the process of drafting a similar rota for the next three months using the same firms, plus any others that are interested. On the rota for Beverley, solicitors from Scarborough are providing Saturday cover, which is operated through a call-in scheme—the duty solicitor is required only if there is a need. After that, the situation is unclear. The eight Hull-based firms are now bringing judicial review proceedings against the LSC on the basis that the other three firms are receiving additional pay for their services.
The Minister suggested that that payment has already been included in the fees. I gave an example of solicitors having to travel to court and wait perhaps three hours for a case to be heard. Is she suggesting that the Hull solicitors would receive the same amount of money as the solicitors from Scarborough? It appears that she is now less keen to intervene.
I am happy to intervene. In my response, I shall set out the system comprehensibly to assist the hon. Gentleman.
I look forward to that and hope that the Minister will answer that straightforward question. If lawyers from Bridlington and Scarborough are being paid more than those from Hull, the hon. Member for Kingston upon Hull, North and I will want to know why and how the Minister can justify that.
The answer is very straightforward: eight firms of solicitors have tried to boycott the work that they are being paid to do, so other resources have had to be brought in. Happily, the court is being served properly and no one’s access to justice has been damaged as a result of the action.
But as a result of the policy of the Government and the Minister, the costs are higher because lawyers have to be brought in from far afield—Darlington, Scarborough or wherever. The Minister’s policy has caused that. Those lawyers have to travel a long way and are being paid to do so. Far from saving money, that is costing the public purse more money. People in Hull who are committed to serving the local community are being affected by reforms that were supposed to increase the local work and focus of lawyers, but are having the opposite effect. Her truculence in dealing with the issue throws light on nothing, except perhaps her attitude. If the Minister will not take that point from me, perhaps she will accept it from the area director of Her Majesty’s Courts Service, who said to me:
“the situation is unsatisfactory and there is a need to ensure that a long term solution is found”—
how different from her view as she sits in her ivory tower.
Will the hon. Gentleman give way?
No, I shall press on to the end of my speech. The area director continued:
“We have stressed to the Legal Services Commission that it is very important to put in place a viable solution which will provide regular solicitor coverage at Beverley.”
As I said, what makes the current situation so inadequate is the fact that it is costing substantially more money to bring in those people than it would to use the Hull-based solicitors. Those firms will be charging for travel to Hull prison and the nearest Crown court, which, funnily enough, is also based in Hull.
My hon. Friend makes an extremely powerful case. Does he agree that such people are not likely to cause trouble or to be obstructive in normal circumstances? They are also being hit hard by the introduction of means-testing in magistrates courts because there will be many more litigants in person, which will clog up the courts and, probably, take work away from many local solicitors.
I agree entirely and, of course, these reforms compound the problem caused by the over-bureaucratic and complicated means-testing system brought in by the Government. They will obstruct access to justice for the poorest and most vulnerable in society. No one doubts the Minister’s commitment to access to justice, but Labour Members increasingly doubt the efficacy of the reforms that she thinks will bring that about.
Briefly—because we are running out of time—what will be the impact of those reforms on the local supplier base? Nationally, the number of firms holding a criminal legal aid contract has reduced from 2,925 in 2000-01 to just 2,608 in 2006, which represents a decline of 10 per cent. On 17 October last year, in a written answer to the hon. Member for Meirionnydd Nant Conwy (Mr. Llwyd), the Minister admitted that two thirds of legal aid practices had disappeared since 1997—under the Government’s watch.
All the available evidence suggests that that trend is likely to continue. Moreover, as a result of the reforms, smaller firms will be forced to close or amalgamate. As my hon. Friend the Member for North-West Norfolk (Mr. Bellingham) said in January, many firms
“are not in criminal legal aid to make money; they are doing it through conviction, as a service, because they believe in the ethos of trying to protect those in society who have real problems and crises.”—[Official Report, Westminster Hall, 11 January 2007; Vol. 455, c. 169WH.]
The fragility of the supplier base is also a major issue on which I hope that the Minister will reflect.
In summary, it is extraordinary to see a left-wing firebrand becoming a marketisation freak who is committed to forcing a market-based ideology on to a system when there is no problem. Costs are under control and services are good. This is a solution trying to find a problem and the supplier base is being put at threat. Large firms are likely to result from the tendering process, rather than small responsive firms with specialisations. All that will have come about under the Minister’s watch. I and other Members on both sides of the House hope that she will think again, listen to the warnings from experts and this House and recognise that her reforms, far from leading to quality, will lead purely to cost constraints, although there was not a problem in the existing system.
I congratulate the hon. Member for Beverley and Holderness (Mr. Stuart) on securing the debate. I am sure that his constituents are assured that he did so solely out of concern for their interests. I acknowledge and thank Members who have found the time to attend. The hon. Gentleman is right that we have the best legal aid system in the world, by many strides, but he is wrong to suggest that criminal legal aid has not increased. It has done so by 39 per cent. since 1997. That has consequently produced a 37 per cent. decrease in civil legal aid. I will come on to the impact of that on the poorest in society.
It is not correct to suggest that the Hull firms will receive less than before and the figure of £30,000 is not correct. They have achieved a clear 2 per cent. pay rise, assuming that they do the work that they are contracted to do, which they are now not choosing to do in Beverley.
Will the Minister give way?
I am afraid that I do not have time to give way because the hon. Gentleman ran over his allocation of time and I must respond to the points that he chose to raise, many of which were incorrect.
The hon. Member for North-West Norfolk (Mr. Bellingham) intervened intending, I think, to help his colleague. He suggested that the people involved would not usually cause any difficulty. However, he missed the fact that the hon. Member for Beverley and Holderness said that this group of people had been fiercely opposed to the introduction of the changes. They have been on strike already and it is clear that they are acting collectively now.
Before dealing with the points that the hon. Gentleman raised, I shall reiterate the principles behind the Government’s programme of legal aid reforms, the thrust of which is supported by his party. On 15 March, in the Public Bill Committee that considered the Tribunals, Courts and Enforcement Bill, the hon. Member for North-West Norfolk, who is in the Chamber now, said:
“We realise that there are pressures on the legal aid budget, which has increased from £1.5 billion 10 years ago to more than £2 billion, and we understand why the Government are now bringing in means-testing in magistrates courts and the fixed-fee system for many…cases. Although we have…legitimate discussions…with the Government about how that is being implemented, we accept the thrust of what they are doing.”––[Official Report, Tribunals, Courts and Enforcement Public Bill Committee, 15 March 2007; c. 46.]
I mention that because the correspondence from a solicitor local to the constituency of the hon. Member for Beverley and Holderness, which his office has kindly shown me and which essentially gave rise to this debate, is a diatribe against the totality of the reforms that both his party and mine accept are vital if we are to serve the poorest in society.
Our reforms will serve the people who rely on legal aid. I recently opened the community legal advice centre in Gateshead in the north-east. Historically, people needing advice have got only what the legal profession has delivered. People, often with multiple problems involving such matters as welfare benefits, debt, housing and family, have had to work out exactly what type of advice they need and then go to the right supplier, who might be able to give them help with one problem, but not all of them. The more people are referred on to supplier after supplier, the less likely they are to go—they get referral fatigue. Anyway, research makes it clear that specialists do not refer people on for the right advice if they do not have the necessary expertise in their firm, even if they see a person’s need.
Community legal advice centres such as that in Gateshead will be well publicised. They will invite people with problems to come through the door and ensure that they are connected to all the advice that they need. People will need simply to come through the door and ask. Such investment, which can make a huge contribution to preventing chaotic lives from declining into the social exclusion that untackled problems can cause, will follow from getting a grip on spiralling criminal legal aid expenditure. We will also ensure that the structure of criminal legal aid supports improvements to our criminal justice system by using it to drive efficiencies, such as controlling the money spent on paying for lawyers’ travel and waiting time.
I come now to the concerns that the hon. Member for Beverley and Holderness raised about the introduction this April of the new standard fee system for magistrates courts. Magistrates courts have worked on the basis of standard fees for years. The change is to average out the payment for lawyers’ time spent on local travel and waiting, to put it into the standard fee and to remove merely one third of it—not all of it, as the hon. Gentleman suggested—so that people are encouraged to operate more efficiently. Criminal defence practitioners who have business premises in Hull and have historically carried out work in Goole, Beverley and the other places to which the hon. Gentleman referred have received a 2 per cent. pay increase under the new fee system. The letter of diatribe to the hon. Gentleman did not mention the pay increase.
All eight solicitors’ firms in Hull have decided not to go to work in Beverley any more and have resigned from the duty rota there. That is their privilege. The 2 per cent. increase applies if the solicitors travel to do work in those outlying areas, as they have done in the past. If they do not travel there, they will be working in Hull. Their offices are in the city centre, within easy walking distance of the magistrates court, and they will thus get a far bigger increase in fees by profiting from being paid for the time spent travelling—that payment is rolled up in the fixed fee—although they are not travelling. That means that they are getting two thirds of the pay for travelling to and waiting at both Hull and Beverley, but they are not going to Beverley—they are walking only to the Hull court.
A 2 per cent. increase in what the solicitors were earning for covering all the courts seems a very strange reason for deciding to withdraw from Beverley. I find it very surprising that all eight of the Hull suppliers have simultaneously found it commercially attractive to withdraw from Beverley. I am told, as the hon. Member for Beverley and Holderness reiterated, that that represents 20 per cent. of their business, so they must have sound commercial principles in mind. They have said that if we pay them again—on top of the travel element of the fixed fee—to go to Beverley, they will be prepared to do so. By the way, they get their mileage costs in addition.
I find it even more surprising that the letter from a solicitor local to the hon. Gentleman’s constituency asserts that the decision taken by the solicitors had something to do with access to justice. I wonder how many people at the court centres no longer served by the lawyers would like to be helped by a representative whom they know, but will now have to be represented by a new firm, although no doubt that new firm will give them good service. I am very pleased that local suppliers outside Hull have taken a different approach: they are prepared to help people in trouble at those courts. I am also pleased that the courts continue to operate effectively with proper representation from solicitors who are local to the area.
The hon. Gentleman cited the HMCS director in an out-of-date memo. The director e-mailed the hon. Gentleman’s parliamentary assistant yesterday to indicate that he was satisfied that the system was now working well and that e-mail was copied to me.
Will the Minister give way briefly on that point?
No, the hon. Gentleman overran his time. I will answer his point.
It is right that the public defender service had to be deployed for a while to ensure that no disruption to access to justice was caused by what was frankly a boycott. However, although its personnel remain available and we are immensely grateful to the dedicated team of public servants, they are not needed at present in Beverley, which is served by good-quality local solicitors’ firms.
On a point of order, Miss Begg. For clarification, the letter from the area director of Her Majesty’s Courts Service is dated 4 June.
That is not a point of order. I call Vera Baird.
It is pretty obviously not a point of order. Mr. Bradley, the gentleman who was referred to, e-mailed the hon. Gentleman’s assistant, Tim, yesterday and pronounced himself satisfied with the system that we have managed to put in place. That e-mail was copied to me. I am afraid that the hon. Gentleman is not making a very good point.
Over the past two years, there has been a fundamental examination of the way in which the Legal Services Commission delivers legal aid. We have carefully considered the full range of independent research that has been published—not only the publications that the Government and the LSC commissioned—and that research has informed and launched our programme of reforms and will continue to shape it.
I do not seek to hide from the fact that the extension of fixed and graduated fee systems will require legal aid practitioners to change how they work. Many legal aid practitioners, largely in bigger cities, are already successfully moving from remuneration based on time spent to remuneration based on effective services delivered to clients. That will allow the Government to have greater control over spending and will encourage suppliers to improve their efficiency ahead of best value tendering. Such tendering, which will be introduced from October 2008, will enable the LSC to purchase legal aid services on the basis of quality and price.
The key to the new procurement system is balancing quality and access for clients, value for money for the taxpayer, and fair remuneration for providers. I strongly believe that efficient, flexible and innovative suppliers will benefit from, and flourish under, the reforms. It is part and parcel of the acceptance by the hon. Gentleman’s party of the thrust of the reforms that it thinks that as well.
Our proposals for legal aid are part of a wider reform agenda across the entire justice system. The coming months and years will see the implementation of the reforms that we have set out to the immense benefit of the public. The reforms will bring improvements to the justice system for not only the people it serves, but the professionals working in it who are willing and able to cope sensibly with change.