Community Legal Service (Funding) (Counsel in Family Proceedings) (Amendment) Order 2009

Considered in Grand Committee

17:40:00

Moved By

Baroness Butler-Sloss
That the Grand Committee do report to the House that is has considered the Community Legal Service (Funding) (Counsel in Family Proceedings) (Amendment) Order 2009.

Relevant Document: 25th Report from the Merits Committee.

Baroness Butler-Sloss
My Lords, I congratulate the Government on the excellent family and child-based legislation that they have introduced over the past few years. However, the order to which I speak, regrettably, is not in that group. The purpose of my Motion is to bring to the attention of the House criticisms of the Ministry of Justice and of the Legal Services Commission in relation to their process of consultation over decisions on the legally funded fees of family barristers and the impact their decisions will have upon vulnerable families going through the family courts and on the family Bar, particularly on women barristers and especially on BME women who appear for these families under public funding. These criticisms have been supported by the Justice Committee of the House of Commons in its 8th report of July 2009, and by the Merits Committee, of which I am a member, in its 25th report of Session 2008-09.

Very shortly, the background is given in paragraph 9 of the Justice Committee’s report, which states:

“Much of the debate about family legal aid reform inevitably revolves around fees and payments, which give the impression that the issues are solely about how much to pay lawyers. It is all too easy to lose sight of the overall purpose of family legal aid which is the provision of a service to families, and particularly to children, to enable them to gain access to justice and to help them navigate effectively through an increasingly complex system. The families, and particularly the children, involved are often confused, emotionally damaged and vulnerable. As Lord Laming stated in his progress report on child protection in the wake of the Baby Peter case: ‘Children are our future. We depend on them growing up to become fulfilled citizens well able to contribute successfully to family life and to the wider society. It is of fundamental importance that the life and future development of each child is given equal importance. Every child needs to be nurtured and protected from harm’. Family legal aid is part of this nurturing and protection and provides a vital service for vulnerable families and children. Their need for this service is as basic as their need for health, education and social services”.
 

In 2008 the Minister said that,

“were it not for the quality of children lawyers that we have at work in this country, then the vital job [they] do would not be done, children and families would not be represented, miscarriages of justice would be the norm, the children themselves would suffer, and the state would end up footing a far greater bill, socially as well as financially, in consequence”.

Most of the family Bar belong to the Family Law Bar Association, which has something like 2,300 members, 61 per cent of whom are women. They are at the sharp end of the family justice system. A large percentage of the family Bar does publicly funded work, paid by the family graduated fees scheme since 2001. It is usually called the FGFS, and I shall call it that, although I notice in the Minister’s latest report it has now been changed to the FGF.

The Ministry of Justice and the Legal Services Commission produced a consultation paper in June 2008, Reforming the Legal Aid Family Barrister Fee Scheme, which proposed cuts of £13 million to family fees over two years—that is, the FGFS. In December 2008 there was a further consultation paper from the Ministry of Justice and the Legal Services Commission which made various proposals for fixed fees and further average cuts of 20 to 30 per cent and, in more complex cases, up to 50 per cent. The system, according to the Family Law Bar Association, would over-reward simple hearings and under-reward complex cases.

There has been great concern among the Bar Council and the FLBA about the reliability and misclassification of underlying data. In February this year, the Minister made a decision on the June 2008 consultation paper that there would be cuts of £13 million over two years to effect public law and private law children cases and financial relief cases, which are called ancillary relief. These cuts are in the statutory instrument about which I ask your Lordships to take note.

There had been discussions between the FLBA and the LSC, which accepted that the evidence was based upon anecdotes and not upon research. Therefore, in March 2009, at a late stage, Ernst & Young were instructed by the LSC to investigate and report.

17:45:00

In March, the FLBA got an important report, The Work of the Family Bar by Dr Debora Price of the King’s Institute for the Study of Public Policy. It included responses from 1,600 barristers that showed that something like 40 per cent of senior barristers of over 16 years’ call were likely to give up legally funded work or much reduce it. The report demonstrated the serious situation that would exist if these cuts were implemented. There was further discussion with the Minister about the reliability of the underlying data, and he extended the consultation period to April. The real concerns of the Family Law Bar Association were over the late use of economic experts and the failure to inform the stakeholders at a much earlier time. At that time, the report was not expected to be ready until August, which was when the Government would give their decision.

The Legal Services Commission said that the economic research of Ernst & Young was not fundamental to the structure of the scheme. However, in giving evidence to the Justice Committee of the other place, it conceded that an assessment of the impact on suppliers of its proposals, part of the Ernst & Young study, was important because a substantial drop in supply would cause a significant problem, and the study was fundamental to the decision on whether the new fees scheme went ahead. When talking about supply, we are talking about the Bar being available to do the cases.

The Minister refused an extension of time and the FLBA and other major stakeholders responded to the second consultation paper in April. The Minister then offered to share the conclusions of the Ernst & Young report by the end of June. The decision on the December consultation was to be given on 14 August. As your Lordships will see, the whole thing was very rushed. On 16 June, the Justice Select Committee held a hearing at which evidence was given by a considerable number of people, including me and members of the Legal Services Commission. The Justice Select Committee had been very critical of the Ministry of Justice and the Legal Services Commission.

At the end of June, the Ernst & Young report was circulated. By 16 July, the FLBA got out a report by Oxera, which was critical of much of the Ernst & Young report. One particular point it challenged was the finding of excess supply. Oxera suggested that it was much more likely that there would be excess demand in the market rather than excess supply. How Ernst & Young got to excess supply foxes me with what I know about what the Bar is saying about this. On 4 August, the statutory instrument before the Committee was implemented.

The Government have asserted that there was a significant rise in the costs of the family graduated fees scheme. Paragraph 7.12 of the Explanatory Memorandum to the statutory instrument states,

“legal aid payments to family barristers have risen unsustainably over the five years from 2003-04 to 2007-08”.

That seems a considerable exaggeration. I will give your Lordships the figures in a moment. The Merits Committee questioned the ministry about the statutory instrument and the lack of an impact assessment attached to the Explanatory Memorandum. We were told that family barrister fees were nearly £100 million. The Family Law Bar Association answered the Government figures and stated that the £100 million includes non-FGFS payments, such as payments in the magistrates' courts and other payments that are not to be treated as part of the FGFS. The Government have taken into account the 8 per cent that they over-deducted in 2001 and put back in 2005. In addition, there has been an increase in the volume of cases. For example, everyone knows from the press how many additional cases have come in to the care side of the courts because of Baby Peter. In fact, the FGFS costs have been pretty well controlled, and the Justice Committee quoted from the Legal Services Commission report the following figures. In 2005, the cost was £90.6 million. It was revised by the Ministry of Justice on 26 May 2009 to £88.5 million. For 2006, £94.1 million was revised to £90.4 million, and for 2007, £98.2 million—getting rather close to the £100 million—was revised down to £89.9 million. So these figures, showing an unsustainable increase, may be for overall legal aid, but not for this particular set of barristers’ fees.

The Merits Committee put into paragraph 10 of its 25th report a previous Justice Committee report, which had said in 2006, I think:

“More reform is inevitable. However, the consistent message from evidence received on legal aid reform is that the Commission is proceeding at speed with inconsistent data, a weak evidence-base and a poor understanding of the shape, the cost drivers, other motivating factors, and the structure of its supplier market. In addition, as Lord Carter himself emphasised strongly, this fundamental reform of legal aid provision—for 60 years the pride of the justice system in this country—requires the cooperation of those who deliver the services”.

The Merits Committee said:

“In the light of these comments the House may wish to seek further information from the MoJ on the robustness of the assumptions that underpin the current Order”—

that is, the one before this Committee—

“both in terms of likely savings and the profession’s willingness to deliver a service under its terms”.

That is why I have put this Motion to consider before the Committee.

The Justice Committee’s report pointed out, therefore, that there is quite a history to the Legal Services Commission dealing with stakeholders and with controversy over the work commissioned by it. I mention in passing the second Otterburn study. The previous Justice Committee,

“was profoundly troubled by the handling of the Otterburn issue on the part of the LSC”.

This Justice Committee said that there were obvious flaws in the evidence of the Legal Services Commission that,

“should have been sorted out in advance of the proposals”,

and that the Legal Services Commission had,

“made a substantial rod for its own back”.

The Justice Committee also dealt with the implications of the proposals. Perhaps I may give just one example: a case before Mrs Justice Hogg, with four Lever Arch files of 1,200 pages, 29 hours of pre-trial preparation, four days in court and 66 hours as expended by the parents’ advocate. If it had been a private client case, it would have been worth about £9,900. Under the existing legal aid scheme, prior to August of this year, it would have been worth £4,875.25. Under the new legal services scheme, all that work will be worth £1,909. The Justice Committee,

“found the line taken by Lord Bach to be highly unconvincing”.

It also set out in considerable detail at paragraph 47 of its report what had been said by my successor as the president of the Family Division and stated that it agreed with it. It then put into its conclusion at paragraph 51 what Sir Mark Potter recently said, which neatly encapsulates the points:

“It is no function of mine as Head of Family Justice, to participate in negotiations between government and the professions as to the terms of their remuneration. However, it emphatically is my concern as Head of Family Justice to bring forcibly to the attention of the government the threat to the efficient working of the system in terms of both efficiency and delay if the LSC proceeds regardless of the warnings of the profession and, in particular if those specialising in children cases abandon or cherry pick publicly funded work. Quite apart from the strain upon family judges and the courts' administration by HMCS, there will be significant further delays in the court process caused by inexperienced advocates undertaking more complex work; longer and less focussed hearings; a higher incidence of litigants in person and a greater likelihood of appeals where cases become derailed because of inadequate representation at first instance”.

We are talking of course about members of the public caught up in child and other family cases—some of the most vulnerable people. I do not want to take any more time, so I shall not deal with the effect on the various groups of people, which will be obvious to your Lordships.

There is also the impact on the Bench. Many judges at district, circuit and High Court level are appointed from the family Bar. In future, there will be a lack of family practitioners to go on the Bench, which will have an adverse effect on judicial diversity. Almost half the judges of the High Court Family Division are women; it is the only division in which you have that large number, because they are family practitioners. Will they be there in five or 10 years’ time?

On 21 October, the Minister gave his decision and consultation response, although that was after the statutory instrument to which I refer. It made some minor improvements in public law work but none in private law or financial cases. The Family Law Bar Association has regretted the lack of further consultation and has very real concerns about the driving away of experienced practitioners. My concerns are about the continued failure of the Ministry of Justice and the Legal Services Commission to get reliable evidence and accurate data before making fundamental changes and to engage in a proper, collaborative discussion with stakeholders. They need to improve their current poor relations, which will require a fundamental change of attitude on the part of the Legal Services Commission. I ask the Government to do better and give us an assurance that they would genuinely listen and act on constructive criticism. If they do not, there will be a serious adverse effect on the administration of family justice and on some of the most vulnerable people in our society, mainly children. I apologise to your Lordships for taking so long, but this is a very important matter. I beg to move.

18:00:00

Lord Lester of Herne Hill
My Lords, I am sure that the noble and learned Baroness, Lady Butler-Sloss, does not need to apologise for the detailed way in which she introduced her Motion and gave us a chance to have this debate. We should all be grateful for it because she has raised extremely important points. It will not surprise anyone to know that I am not a shop steward speaking on behalf of the family law Bar because I am not a family law practitioner. My interest in the subject, as the Minister’s advisers will know, is in the work that I did with them on the Forced Marriage (Civil Protection) Bill, which, thanks to them and Ministers, became fit for legislation and is now part of the law.

The points that I want to raise are ones for which I am indebted to a very eminent and well qualified family law practitioner—namely, Khatun Sapnara, who helped very much in preparing the Forced Marriage (Civil Protection) Bill and has enormous experience dealing with domestic violence and forced marriage issues. I have skimmed the 106-page impact assessment, the 71-page consultation document and the statistics to support the Government’s analysis, so I think that I understand what I am about to say. However, I shall no doubt be proved wrong if I say something that is wrong.

As I understand it, forced marriage cases are outside the graduated fees scheme, and so are effectively protected. That is excellent. Forced marriages are closely related to cases of abduction and those, too, remain outside the graduated fee scheme. That is also excellent. In the consultation, the Government asked whether forced marriage cases should brought within the scheme. The response from the Family Law Bar Association and the Family Justice Council was that it is far too early, following implementation of the Forced Marriage (Civil Protection) Act, to introduce this, coupled with the fact that the Government had committed themselves to proper legal funding of cases of that kind. All of what I have just said is most welcome.

There is a problem that I do not think is dealt with in the detailed analysis that I have skimmed. As a result of the complex nature of forced marriage and the issues it raises, such as shame, honour, underreporting and so on, cases frequently arise in the context of private law proceedings and cases involving domestic violence. Those private law proceedings and cases involving domestic violence fall within the scheme. The problem is that the rates will not attract the experienced practitioner who is able to deal with the matter effectively. An experienced practitioner would be able to understand the interface with public law proceedings and abduction proceedings, where the facts of forced marriage—to put it broadly—may intersect.

I shall give a couple of examples. Suppose a British Asian mother applies for a domestic violence injunction to protect herself and discloses that the father is also assaulting the daughter and planning to take her abroad for a forced marriage or that allegations of that kind are raised in the context of private law contact and residence proceedings. An experienced family law practitioner would be able to elicit the necessary disclosures and instructions in the first place and then go to the High Court seeking protection in the context of abduction proceedings or would know how to invite the court to initiate public law proceedings by directing the involvement of social services. The real problem—which is not addressed in the analysis that I have read, where statistics are incapable of being sufficiently refined to home in on this important problem—is that in all probability only very junior and inexperienced barristers would handle such work under this scheme, which simply does not pay enough for the kind of experienced practitioners who are needed.

Private law cases, as the noble and learned Baroness, Lady Butler-Sloss, has just illustrated, can be very complex and lengthy, requiring witnesses, interpreters, findings of fact and skilled handling of an often very distressed lay client. That is the problem which I know concerns many in the Family Law Bar Association and the Family Justice Council and comes out of the practical experience of someone such as Khatun Sapnara. If that is the case, it is a serious problem for the small minority of very vulnerable people who need to be properly protected by a skilled and senior branch of the legal profession.

Lord Carlile of Berriew
My Lords, I am speaking in this afternoon’s debate not because I am a shop steward for the family law Bar, but for two particular reasons. The first is the seriousness of the work. This was brought home to me over 20 years ago, when I had completed what turned out to be my last case in family law. I achieved what I thought was a satisfactory settlement for access to children for my male client, a father of two. Within a very short time, he murdered both children out of revenge against his wife for what had happened in court. If ever a situation could bring home to a lawyer how serious and responsible this kind of work was—for it appeared to be a perfectly ordinary case in a small Welsh town—that was it.

My second reason for being here is that last week I happened to be at a social gathering that involved the retirement of a judge who specialises in family work, including, in particular, public law children’s work. I conversed with a lot of judges—circuit judges, a couple of High Court judges and district judges—and their staff at that social gathering, and every single one of them said that the whole process was becoming grindingly more difficult. There were far more litigants in person, which meant that cases were taking longer. The family law Bar appeared to the judges to be demoralised as a result of the very matters that we are debating this afternoon, and the whole picture seemed to those judges to be a very unhappy one.

Of course, I accept that both the matters that I have mentioned are merely anecdotal evidence, but I do not believe that there is much better evidence on these issues than anecdotal evidence. We can debate reports by economists until we are blue in the face; we can argue about the basis for their inquiries; we can quarrel about the methodology of their research; and we can certainly, as we have already done, discuss the meaning of their figures. We can also take some very misleading international comparisons, too, but I urge the Minister not even to enter into those because we are dealing with very different types of systems.

However, essentially, we are dealing with a practical question here, and I applaud the noble and learned Baroness, Lady Butler-Sloss, for raising it here today. The core of that question is where the welfare of children lies in relation to the provision of fees for legal aid lawyers. Are we here to pay lip service to the welfare of children or to do real service to it? The Government—whose motivation is good—repeatedly pay lip service to the welfare of children, but this order will mean that children will suffer. The Minister is shaking his head but he does so, I am afraid, against the overwhelming body of evidence from those—and I say this with great respect to him—who are possibly rather better informed than he is about what happens in family courts every day of the week.

We must bear in mind that we are not talking simply about a few whinging barristers or solicitors who are complaining about the fees; we have heard in this debate from the immediate past president of the Family Division of the High Court, and, remarkably, in connection with this debate, we and the Justice Committee have heard from the current president of the Family Division of the High Court. In my recollection, it is unprecedented for heads of division to enter into a debate of this kind with such energy. I remind the Committee what Sir Mark Potter, the president of the Family Division, said on 2 July this year in his Hershman/Levy Memorial Lecture to the Association of Lawyers for Children. He reported serious delays in cases, partly because of the reduction in CAFCASS and the delay in obtaining reports for courts. He went on to warn Ministers—this was his word—“forcibly” over their plans to reform legal aid funding in children’s cases, and he referred to the cuts as a threat to both efficiency and delay. The use of the word “threat” by the current president of the Family Division is remarkably bold. It would be a remarkably bold statement from any judge but particularly from one—I am sure the noble and learned Baroness will agree with me—who is not naturally given to delving in politics if he can possibly avoid it; he is not a government scientist. He said that if lawyers left this area of work, there would be a rise in the number of people representing themselves and further delays caused by, as he put it,

“inexperienced advocates undertaking more complex work”.

He said hearings would be less focused and appeals more likely, and he attacked the Legal Services Commission over what he called a discouraging lack of realism in its apparent determination to disregard the warnings that he and others were giving.

I do not want to repeat what has already been said so skilfully and forcefully by the noble and learned Baroness. She has drawn your Lordships’ attention to the reports of the Merits of Statutory Instruments Committee and the Justice Committee. She has already drawn attention to the argument—and it will remain an argument because we are not going to solve it here—about the nature of the figures that have been produced. Ultimately, if this order remains in force in its present form, we will have discriminatory legislation. It will discriminate against women litigants—because many of the litigants in this area are women—and it will discriminate, particularly, against children, as I have already said. It will discriminate strongly against women and children from black minority ethnic groups because some of the least skilled litigants and litigants in person in this area are women who do not have the social skills to be able to represent themselves in court because their customs do not give them social skills. As anyone who has ever tried a case with litigants in person will know, there is nothing worse in a court than a frightened litigant in person appearing before a judge.

As the noble and learned Baroness said, it will also discriminate against female barristers because women form the greater proportion of barristers doing this kind of work. They do it far better than most men possibly can because they have an understanding—I hope this is not a sexist expression; if it is, I make no apology for it—of issues that sometimes male lawyers find it difficult to get their heads around. The effectiveness of what the Bar and female advocates have done in this area has amply justified the view that the money has been well spent; compared with many other areas of the law, there have not been galloping increases in legal aid funding.

The Baby P case and the greater intervention of local authorities in the welfare of children are not going to result in fewer cases but in far more, as Sir Mark Potter has said. There is nothing in this order that promises that those cases will be dealt with fairly and efficiently; it will be absolutely the contrary.

Lord Thomas of Gresford
My Lords, following my noble friend Lord Carlile, a good starting point to understanding why these cases have become more complex is the evidence given by the Association of Lawyers for Children to the judicial committee in the House of Commons.

Lord Hunt of Wirral
The Justice Committee.

Lord Thomas of Gresford
The Justice Committee. It set out a list of issues; there may be many more, but this is what it assumes. There is a vast area of new jurisprudence and obligations arising out of the European Convention on Human Rights; there is an ever-increasing volume of papers in children’s proceedings arising from the ECHR; there are new forms of documentary evidence and greater judicial expectations; the use of e-mail includes the expectations of clients for contact and explanation; there is an ever-increasing amount of case law, practice directions, and legislative and other initiatives; and there is an increased focus on the care plan in public law proceedings, rather than on the issue as to whether or not to make a care order.

Then there are advances and ongoing research in medical science, especially related to injuries, and in the understanding of child abuse. I had some experience of that in a case in July. I was dealing with the criminal end of it but the whole of the family proceedings were before me. The case had lasted about six days, with a vast amount of documentation, exhibits and medical evidence, with experts disagreeing on either side, and with the judge having to come to a conclusion and counsel on both sides doing their best to cope with difficult medical issues. Then there are diversity issues and a matter to which my noble friend Lord Carlile referred—the problems that many litigants have with English, it being their second language. There are also litigants with learning difficulties and so on. All these problems have added up to cause great difficulty in the family courts.

18:15:00

It is ironic that at the moment, when public concern about the protection of children is rising as a result of the Baby P case and other cases, the Government step forward and cut the provision for legal aid in this sensitive area. There are times when one appreciates the huge gap that has opened up between government and the reality of what goes on in the courts. I do not know how many of those behind the Minister today have practised in the courts or have been in the courts and heard cases, but it seems that much of the legislation that comes forward from the Government is not based on proper evidence. The Justice Committee referred in its report to the complete lack of adequate research on this matter—for example, research into the impact of the provisions that are being put forward on the suppliers of legal services.

On other occasions, the Minister has said that the gaps will be filled by in-house advocates, the provision of alternative business initiatives or other things that do not exist at the moment. An order was introduced in July and put into effect in August 2009 in the context of a system of legal services that does not exist. If the Minister goes back to what he has done in the past and relies on this pattern of supply—on the future that he foresees—he will be doing a great disservice to the seriousness of the issue. The family service is for vulnerable children and families and, as the current economic climate gets worse, relationships crumble, marriages break up, children suffer, violence enters the home and the problems that come before the courts get more difficult and complex.

All are agreed that legal aid expenditure must be controlled, but the people who appear in court are not there for the money but because they are dedicated, whether they are barristers, solicitors or advocates. In 2006, the noble Lord, Lord Carter of Coles, wanted to shift legal aid from piece work to block contracts and from paying for time to paying for outcomes. What has not been appreciated is that to get to the nirvana sought by the noble Lord, Lord Carter, takes a lot of detailed, complex steps and care. It is that care, investigation and research that the Government have not done.

Our view is that the proposals before us in this order will simply cause future problems. They leave too many vulnerable people without help. Families will run into greater difficulties financially and otherwise, and the state will be torn between removing children and saving money. Ultimately, the lack of properly considered ancillary relief will push broken families into the path of destitution.

The other argument advanced by the Government is that it is all swings and roundabouts. “Yes”, they say, “we are reducing the provision of legal aid by £13.5 million, but we are paying people more for less”. In other words, they are paying more for the less complex cases and taking money away from the more complex to pay for the first group. However, that ignores the basic principle of how the legal profession works, has always worked and, one hopes, will always work—namely, that more experienced practitioners will do the more difficult cases. That is the point made very strongly by the noble and learned Baroness, Lady Butler-Sloss, who is to be heartily congratulated for bringing this matter forward.

You cannot expect experienced practitioners to go into the smallest cases to get more money. In Hong Kong, it was a joke that when you joined the Hong Kong Bar in the criminal field, in the first six months you would find yourself either prosecuting or defending in a murder case. As you made your name and became better known, you would go down the courts and in the end appear in the magistrates’ court for huge fees, paid by people with enormous fortunes who were being done for speeding. You could see how the profession in Hong Kong was being dragged down in that way. Structuring a legal aid system in such a way that the more experienced people are tempted to do the less difficult work is crazy.

One hopes that we will hear from the Minister that the Government have something a little better in mind for the future and that they will not pursue the course that they have so inadequately pursued so far.

Lord Hunt of Wirral
My Lords, first, I declare my interest as a practising solicitor and partner in the national commercial law firm, Beachcroft LLP. I have benefited greatly by the debate initiated by the noble and learned Baroness in laying her Motion to take note of the order that came into force as long ago as 4 August. As she pointed out, the order makes changes to the legal aid family barrister fee scheme—the family graduated fee scheme, or FGFS.

The justification that the Government have given for these changes, on the surface at least, sounds reasonable. They have increased the basic rate paid to counsel for public law children cases by approximately 17 per cent and reduced and abolished some of the special issue payments made to barristers, making a large saving for the legal aid budget. At least, I might have thought that they sounded reasonable until I heard the speech of the noble and learned Baroness, as well as those of the noble Lords, Lord Lester of Herne Hill and Lord Carlile, and a very persuasive and rather worrying speech from the noble Lord, Lord Thomas of Gresford. I know that on occasions in the past the Minister has had to defend the indefensible and explain the inexplicable, but I think that that will be a test of all those abilities on his part.

One effect of the order will be to allow the harmonised fee scheme to take effect from next October, putting in place the same remuneration for barristers and solicitors and, we are told, rewarding case complexity. Currently, solicitors are paid on a different remuneration basis, focused around an hourly rate. We know from correspondence with the Law Society that it is broadly supportive of these proposals, which it sees as a first step towards a harmonised advocacy scheme, levelling out the rates payable to barristers and solicitors for the same work.

It is hard to deny the fairness of that, although there is more than one outcome as a result of the changes wrought by this order. It will not surprise the noble Lord—particularly having heard these very telling speeches—that the Bar Council has been somewhat less enthusiastic in its response. The noble Lord may say that it is not possible to please all of the people all of the time, especially when budgets are under strain. However, the Bar Council has raised a number of very salient concerns, which ought to be considered carefully. As the noble and learned Baroness and the noble Lords, Lord Lester of Herne Hill, Lord Carlile and Lord Thomas of Gresford, have now raised some compelling arguments, I can hardly wait to hear the Minister’s response.

Of course, we start with the premise of the need to make savings. The noble and learned Baroness stressed that throughout her speech; she acknowledged the importance of making savings, but the figures that she used were fascinating. Can the Minister confirm that the existing payment regime—the FGFS, which came into being in 2001—has resulted in the savings of 5 per cent that it was expected to make, resulting in the Government agreeing to put money back into the scheme in 2005? Can the Minister please tell the Grand Committee in very clear terms what the financial implications of the order are? Does it mean that £2 million per annum is being removed from fees paid to barristers in public law cases?

I note, as has the noble and learned Baroness, that the consultation paper published in June 2008 relied on data which had to be revised in a letter from the MoJ in May this year. It showed that the FGFS had largely succeeded in controlling costs. Can the Minister explain why the Government continued with the cuts proposed in the order, even though the underlying rationale had been shown to be mistaken? There are, of course, quite legitimate reasons to seek to trim government expenditure, but it is also useful, particularly for noble Lords, to have them properly justified. The noble and learned Baroness has asked the Government to consider the effect of these cuts in the real world. I found very compelling some of the cases which have been instanced in this, sadly all too short, debate.

Family legal aid is, as I think all noble Lords would agree, a very sensitive area. The service is indispensable for families and crucial in the role that it plays in protecting children from circumstances of sometimes appalling abuse. Sadly, the role of the state in intervening in the care of children has had very high-profile coverage in recent months, and not for the happiest of reasons. Does the Minister accept that the changes to the funding of public law cases to be brought about by the order increase the risk that effective representation may suffer? I am now very concerned that the number of family barristers willing to undertake difficult and complex cases may fall because taking on such cases may simply be uneconomical. I was persuaded that it is not just a case of excess demand or supply; it is a case of looking at what the effect of the order will be in the real world. Can the Minister tell noble Lords what work the Government are now doing with the Bar Council, the Family Law Bar Association and the other interested parties that have been mentioned to ameliorate this concern?

I was very impressed by the arguments adduced by the noble and learned Baroness in referring to the Merits Committee, on which the noble and learned Baroness sits. Its 25th report quotes the Justice Committee, as the noble Lord, Lord Thomas of Gresford, rightly said. I quote it now because it is a very worrying message:

“The consistent message from evidence received on legal aid reform is that the Commission is proceeding at speed with inconsistent data, a weak evidence-base and a poor understanding of the shape, the cost drivers, other motivating factors, and the structure of its supplier market. In addition, as Lord Carter himself emphasised strongly, this fundamental reform of legal aid provision—for 60 years the pride of the justice system in this country—requires the cooperation of those who deliver the services”.
 

Finally, will the Minister explain how he hopes to implement successful reforms if he does not have the good will of the profession which must put those reforms into practice and live by their results? Of course, there is pressure on all budgets all around government—all departments are, or ought to be, looking for savings where possible—but we look forward to hearing what the Minister has to say in defence of the order and the changes to funding that it makes, and exactly what his department is doing to work with the legal professions to effect changes in the smoothest manner possible.

18:30:00

The Parliamentary Under-Secretary of State, Ministry of Justice (Lord Bach)
My Lords, I thank all noble Lords for today’s lively and interesting debate and, in particular, the noble and learned Baroness, Lady Butler-Sloss, for bringing the Committee’s attention to the important issue of legal aid. We should debate it as a House more often than we do. No one who has listened to the debate could fail to be impressed by the expertise not only of the noble and learned Baroness but also of all those who have spoken so far.

Legal aid funds help all kinds of people in all kinds of situations: the young man suspected of burglary, the elderly woman threatened with eviction, the looked-after child being offered a new life through adoption and the overburdened mother struggling with debts. Too often, legal aid is seen as being just about courts; it is not. It is also about getting the advice that you need at as early a stage as possible, so that your case does not necessarily end up in court. It is about making sure that court is the last resort—this is particularly true in family law—and not the first port of call.

At the risk of incurring the wrath of the noble Lord, Lord Carlile, early on in my speech, I draw to the Committee’s attention a recent independent report, hot off the press, on international comparisons of legal aid spend in England and Wales. It is a proper academic report and does not all go one way. While it is not something that I intend to boast about, particularly before this group of noble Lords gathered today, it shows something that is undoubtedly true: that England and Wales has one of the highest per capita legal aid spends in the world. The report confirms that, as a result of higher case volumes and higher average costs per case, legal aid expenditure per head of population in England and Wales is infinitely higher than in other countries, including France, the Netherlands, Germany, Sweden—which all have different systems from ours—and Australia and Canada.

Lord Carlile of Berriew
Perhaps I may ask the Minister a fundamental question about that report, of which I am well aware. Where does he find in it a measurement of the activity in other countries that takes place out of courts through, for example, their social services systems? The report seems not to make any comparison of like with like, just as, by way of analogy, reports with foreign comparisons of terrorism custody periods do not compare like with like. It is a totally misleading picture.

Lord Lester of Herne Hill
One has to compare common law legal systems, not common law with civil law. They are entirely different. If one, for example, deals with costs in Strasbourg and cost orders, it is always the case that English practitioners’ costs are much higher than those in continental countries, but if one compares the costs with Canada, Australia, South Africa, the United States or any common law countries, one sees that it is a totally different picture. One is comparing apples with cement.

Lord Bach
Of course, and I started this part of my speech by saying that comparisons are very difficult to do. It is undoubtedly true that the cost of courts in this country is much lower than in other countries, but the cost of legal aid in this country is much higher than in other countries. We have an adversarial system, so any comparison with civil legal systems is bound to be particularly difficult. However, you can make better comparisons with other common law countries than you can with civil systems. It would be hard to argue that, for various reasons, some good and some bad, we do not spend much more than other countries per head on legal aid across the field.

We, as a Government, think that that is an excellent thing. We continue to provide a vital link to justice for many people, particularly the most vulnerable in our communities. I remind the Committee that every year legal aid provides around 2.5 million acts of assistance to people with their legal problems. With regard to the social welfare element of the budget, which is much too small and has been the poor relation of legal aid for 60 years, we are committed to helping people with the problems that can bedevil their lives. Our commitment to that is evident, with an increase in funding of £80 million for legal services delivered by the not-for-profit sector on civil matters, compared with around £24 million in 2000-01. At a time of recession, it is particularly important that we do not slow down our spend at all in that field, and that is why we have provided more money for debt, housing and employment cases. I particularly mention the housing possession court duty scheme, which helped nearly 34,000 people last year.

Under our reform programme, which has been mentioned, steps are being taken to sustain that commitment but also to prioritise the legal aid budget effectively to ensure that it goes as far as possible in favour of civil help for those who need it most. Surely any Government would have to try to remove duplication or inefficiency and secure value for money. Doing so would mean that as many people as possible would continue to benefit by getting the legal help that they need, and we are committed to ensuring that that happens.

The challenge today and in the future is to help as many people as possible with a large but limited budget. We spend around £2.1 billion on legal aid. Spending on legal aid in the past 20 years has increased from £835 million in today’s prices, which is an average annual real-terms growth of about 5 per cent and one of the fastest growing areas of public expenditure.

Of our budget of £2.1 billion, about £1.2 billion goes on crime—that is far too much; the balance is wrong—and only about £900 million on civil, which includes family, asylum and immigration, and social welfare law. In 1983-84, the total spend on legal aid in real terms was about £572 million, which, interestingly, is just less than what we have spent on family legal aid alone this year.

Last month, my department announced a review to be conducted by Sir Ian Magee into the delivery of legal aid to ensure that the £2.1 billion budget is delivering best value for money, that it provides a healthy and sustainable future for social welfare law and that it effectively integrates the criminal defence service within the criminal justice system. The review, whose importance it is difficult to exaggerate, will assess the delivery and governance arrangements of the legal aid system and make recommendations to explore the separation of the criminal defence service and the Community Legal Service—which has been argued for for a long time by people across the political spectrum—and options for doing so effectively and efficiently, should that be the recommended way forward. It will also provide for effective and transparent financial management of both funds and their administration.

In the 10 years since the Legal Services Commission was established, there have been considerable changes in the type of legal advice services that the public need, and we believe now is the right time seriously to review the channels through which legal aid is delivered, together with our wider reform programme, to ensure that we are getting the best value for taxpayers’ money. That is even more important at a time of economic difficulty.

I shall not move into the criminal legal aid debate at the moment, but will go straight to family. We are keen to ensure that we support the provision of help to people with the housing, debt and employment problems that so often trigger not only family breakdowns but the descent into crime. However, the need to secure value for money and to prioritise our resources in everything we do means that we must look at reform on the civil and family side too.

In this debate, there is a danger of confusing two orders. There is the order that has been in force since 3 August and prompted the noble and learned Baroness’s debate. There is also a pending order to do with the new contracts to be signed to come into operation from 1 October 2010. One cannot look at one proposal without looking at the other. The second order is the now-published harmonised family advocacy scheme. The family graduated fees scheme order that came into operation in August is before us this evening.

Spending across all levels of family legal aid has increased fairly dramatically in the past seven years from £399 million in 2001-02 to £582 million in 2007-08, which is an increase in real terms of 24 per cent. The new harmonised schemes—and who could be against harmonised schemes?—will direct more money into public law cases to ensure that children and adults at risk of abuse take the highest priority for legal services. The fee schemes do not represent cuts to the family legal aid budget or to the services received by children and families. They have been designed to be cost-neutral against 2007-08 average case costs and for the first time—not before time—the fees will fairly reward barristers and solicitors with the same fees for the same work. I trust that there is no opposition to that principle.

We have closely involved family lawyers in developing our policy on these changes and, as a result, we made substantive changes to our original proposals to ensure that the new structure would better reflect the variety of cases that advocates deal with and, particularly, their complexity. It has been generally accepted, whether grudgingly or less grudgingly, that the new scheme, which was published last month, does a great deal more service to the complexity argument than the original consultation.

18:45:00

Lord Lester of Herne Hill
The Minister looked questioningly when he said, “I trust there will be no dissent from the same fee for barristers and solicitors for the same work”. What I am about to say is sensitive. The justification for having an independent Bar and barristers is their special skill in advocacy. Some solicitors are perfectly capable of achieving the same level of skill in advocacy, but the problem I have tried to address is of very skilled barristers dealing with complicated cases for private law work being deterred. Does the Minister agree that the whole justification for the side of the profession to which he and I belong is the very special skilled advocacy provided by the senior practitioners at the Bar, with some solicitors being able to do so as well?

Lord Bach
There will always be a place for an independent Bar with highly specialist, skilled barristers. However, I do not agree with the noble Lord in making this distinction between solicitors and barristers. In serious family law work now, in public law and in private law—the most serious, in my view, is always public law—solicitors play a much greater and important role in these difficult and sensitive cases. It is absurd that they should be paid less than barristers for the same work. There is not much between the noble Lord and me, but it is an important principle that should have been brought in many years ago. I hope the noble Lord, Lord Hunt of Wirral, agrees with me on this matter at least. The changes were welcomed by the Association of Lawyers for Children, about which we heard earlier.

We are acutely aware that legal aid lawyers will be feeling the effects of the recession in the same way as everyone else, but the final scheme that we published in October will allow us to achieve a reasonable balance between complexity and value for money which will help sustain access to quality legal services for the most vulnerable in our society.

On family matters, we dispute strongly that vulnerable children will not get the representation they need and that people will go unrepresented. The fee scheme proposals do not involve cuts to the services received by children and families. Clients will of course continue to receive legal assistance through the legal aid scheme as they do now. The majority of this work is conducted by solicitors, who will see significantly increased fees. Under the new scheme, we would expect more solicitors to start doing their own advocacy or to increase the amount of advocacy they already do so well. We are confident that the fees we are offering are fair and will ensure that people will be able to receive the legal advice and assistance they need.

The new fee scheme moves directly more money into public law cases to ensure that children and adults at risk of abuse take the highest priority for legal services. The fee schemes do not represent cuts to the family legal budget or to the services received by children and families.

As I say, spending across all levels of family legal aid has increased dramatically. During that same period, the number of funding certificates issued in family proceedings decreased. Of course I accept the argument about complexity; there may be fewer cases but some of them are certainly more complex than the ones that went before. The cost increases were unsustainable within a limited budget and our fee scheme will help to control future increases. Pressure on the legal aid budget is severe and is likely to increase in the current economic climate as more people require advice on housing, debt, welfare benefit and family breakdown. If we do not control family advocacy costs then we will be forced to cut services to clients, either through cutting the scope of the services that are funded or by reducing the financial eligibility for services.

The phase 2 family fees consultation proposals represent the next phase of the reform programme to bring family advocacy costs under better control and offer a fair payment structure to advocates. We aim to contain inflationary costs on family advocacy and maintain legal aid expenditure at 2007-08 levels. This will be done through the introduction of two standard fee schemes and changes to the scope of funding. We spend more than £120 million a year on family advocacy and we will continue to spend this under the new scheme. Our proposed family advocacy scheme is about paying the same fee for the same work. We have not reduced barristers’ rates to solicitors’ rates but have set an intermediate rate which is fair to all advocates. I repeat: we are making no cuts to services for children and families. Clients will receive legal assistance through the legal aid scheme, as they do now. There are more than 3,000 family legal aid barristers and we are confident that access to their services will not be significantly affected by these necessary changes. We shall see whether there is a successful and lively family Bar in the years to come. My guess is that there clearly will be.

Lord Thomas of Gresford
What happens if there is not? What plans does the Minister have for reviewing the position over the next year or two?

Lord Bach
I remind the noble Lord that there are 3,000 family law barristers at present and many highly skilled solicitor practitioners, too. Of course, if the system was falling apart, any Government would have to act, but there is absolutely no evidence that that is so. That there are difficult cases, particularly in the public law field—more difficult now than there have been over the past 50 years—is undoubtedly true, but there is absolutely no reason to believe that the family Bar will disintegrate as a consequence of these reforms.

As to the effect that these reforms will have on BME providers, the Legal Services Commission has discussed the possible impacts of the family legal aid reforms on female and BME barristers with a number of different stakeholders, such as the Equality and Diversity Committee of the Bar Council. As a result of this and the detailed advice and suggestions that we received throughout the consultation, our original proposals have been substantially revisited, primarily to recognise complexity in cases. We were told that what was needed to assist female and BME barristers was to ensure that the scheme allowed for complexity to be properly rewarded. So the final fee scheme has more gradation to reward advocates who take on the more complex cases, who still are most likely to be barristers. We believe that will mitigate any adverse impact on female and BME barristers and is likely to result in a significant increase in the number of barristers who will benefit under the new scheme, rather than lose.

I was asked by the noble Lords, Lord Carlile and Lord Thomas, about discrimination against women and children and litigants with English as a second language. We do not think that our schemes lead to discrimination against those classes of persons. If clients cannot give instructions well, for example, there will be a bolt-on to the fee to be paid to the advocate.

As to the point about discrimination and that BME women at the Bar are reliant on legal aid, I am not sure whether the Government and the LSC should be the ones held responsible for the fact that a large section of BME and female barristers do legal aid work. It is to some extent a responsibility of the Bar itself and of clerks in chambers, who have traditionally pushed legal aid work in that direction. I would like to see figures for how much private family work is given to BME female barristers, to see whether it explains the issue to some extent.

The noble Lord, Lord Lester, has a particular interest in the issue of forced marriages. He is quite right: forced marriage legislation is outside the scheme. The rates for domestic violence are based on historical costs. However, there are higher fees for such cases in the High Court. There is a bolt-on payment if the client has difficulty giving instructions and another where expert evidence is required. Finding-of-fact hearings, which are an important part of family proceedings, are to be paid as final hearings.

The Government very much value the commitment of all lawyers who work in the interests of the most vulnerable members of society involved in family legal proceedings. That work, which is paid for from the public purse, is never likely to be as financially rewarding as work for private clients, but it is a vital public service. We are using the limited money and best resources that we have to meet pressures created by the recession. It is not an easy matter at the moment to try to balance the legal aid budget. Criminal legal aid is demand-led. We are obliged, under the ECHR, to spend money on representing defendants who are charged with serious cases. That is as it should be.

What is not right is that extra money spent on criminal legal aid should come out of a civil legal aid budget. That is behind our policy all the way. We want to make sure that criminal legal aid does not eat up the civil legal aid budget. That is what has been happening over many years. That is why we asked Sir Ian Magee to look very carefully at whether it is necessary to have two quite separate funds to make sure that if the criminal legal aid budget is much more than is anticipated for various reasons, the balance should be paid from the criminal justice system, rather than the civil legal aid system. I hope that is a philosophy that might find some support among noble Lords present tonight.

As far as the orders and the changes we have made to them are concerned, I can do no better than to quote again from the Association of Lawyers for Children, a much respected organisation. It makes these points:

“The Government’s original proposals were heavily criticised by family lawyers and judges who warned that they would lead to parents and children in complex cases being badly represented, or not even being represented at all … But the scheme has been radically restructured and revised following input from the leading practitioner groups and an intervention by the President of the Family Division”.
 

The Government’s announcement was,

“broadly welcomed by the Association of Lawyers for Children, one of the practitioner groups involved in improving the scheme”.

The co-chair of the ALC commented:

“The priority for family legal aid must be child protection. These are complex, demanding cases, involving the highest of stakes and requiring a high level of expertise to conduct properly. We welcome the Government’s recognition of that priority and reality, together with the significant improvements to the scheme that have now been made. While we still have concerns about some elements of it, the scheme now proposed is immeasurably better, fairer and more practice-reflective than that originally devised. That shows the benefits of working within the family justice system”.
 

There has undoubtedly been a lot of collaborative working within the family justice system since the consultation period ended and that work has borne considerable fruits. The result, although not entirely popular among some commentators and groups, is now generally accepted as being much better than the papers on which the matter was consulted. We now have the possibility of a system for family legal aid fees, starting on 1 October next year, which will be fairer—it will be fair to solicitors as well as to barristers—and takes account of the fact that some family law cases are much more complicated than others. One example of the way in which we have tried to ensure that those who do the most difficult cases get the bigger rewards is that we have agreed to an extra payment depending on the court in which the family hearing is to take place.

I understand how strongly the noble and learned Baroness feels about this issue and about the order that came into force in August. I hope she agrees that the new order, which it is hoped will come into force in due course and which sets the fees and conditions to run from 1 October 2010, is an improvement and that it is being introduced because of the considerable help and assistance that we have had from the FLBA and other groups of solicitors.

I think that everyone who has taken part in this debate has a passion for legal aid and believes that it has a vital part to play in our legal system. The Government have no less a passion for it and we hope to improve it in the years to come.

19:00:00

Baroness Butler-Sloss
My Lords, first, I thank noble Lords for taking the trouble to attend today and for their support. It is important to have an airing of this very important subject. I should like to make certain that it is understood that I accept the need to make savings and to secure value for money. I have absolutely no objection to the harmonisation of fees for the Bar and solicitors for doing the same job, but not for doing different jobs—that is an important distinction.

I accept, as I think I said, that there were improvements in public law payments. These will not take effect until October next year, so we have to go through with the current statutory instrument until then. However, there are not going to be improvements in the private law sector, either in children cases, domestic violence or ancillary relief—that is to say, financial payments. These cases can be as complex, difficult and time consuming as public law cases and, if not well done, some private law cases can become public law cases. There is a long way to go still. I would like the Minister—and particularly those behind him—to reflect on what has been said by noble Lords during the debate.

What the Minister has said has not taken us all the way. I particularly have in mind that the warning of the president, Sir Mark Potter, applies now as much as it did before, save in so far as there are some, but not sufficient, improvements to public law. His warning and the point made by the noble Lord, Lord Thomas of Gresford, is that we need to keep in mind what the family Bar is saying. The Government underappreciate the value of the family Bar—particularly where its ability and experience enables it to obtain settlements which allow people to go away relatively satisfied—when compared to an inexperienced Bar which cannot understand how to settle, and where cases drag on and cost more legal aid money. The longer the case takes, the more it costs, whereas a senior man or woman can get the case over, sometimes on the first day. There is a balance between the costs of cases running on and the extra payment to the more experienced Bar.

I am glad there is to be a review; I hope it will involve all stakeholders. The philosophy of separate budgets is excellent; it will be a real step forward for criminal legal aid not to take from the rest of the budget.

The noble Baroness, Lady Afshar, who wanted to be here but is teaching today, told me in relation to BME women lawyers—barristers and solicitors—that a family lawyer is thought to be a suitable profession for Muslim women. That may be one reason why there are more of them at the family Bar than elsewhere. It is an interesting point that the noble Baroness would have made if she had been here.

Motion agreed.

Committee adjourned at 7.06 pm.