Authors:LAG
Created:2014-09-25
Last updated:2023-09-18
Grayling makes his move
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Administrator
In response to the judgement in the criminal legal aid judicial review  last week, the Ministry of Justice (MoJ) has announced a consultation on the Otterburn and KMPG reports. This will be open for three weeks and will end on 15th October.   Already though there are question marks over the consultation and the tender process. Many believed that a four week consultation was the minimum the MoJ could get away with without risking a further judicial review. It will also be difficult for the government to ignore the substantive findings of the reports and perhaps most importantly, they are up against the deadline of the general election to get the tender for the duty police and magistrates courts duty contracts off the ground.   To model what is likely to happen in the market for criminal legal aid service, both reports assume that firms which successfully bid for duty contracts will relinquish 50% of their own client work. This is a highly contentious issue, as the organisations representing solicitors do not accept that in reality firms would give away significant amounts of this work. Once they have picked-up a case on a duty rota, criminal legal aid solicitors tend to guard zealously against losing the client to a competitor. Due to this, in their responses to the consultation, solicitors are likely to argue that the methodological basis of the model proposed by the government is fundamentally flawed.   The Otterburn report throws into doubt the government's plans in a number of significant respects. It questions whether firms will have sufficient time to consolidate into the larger units necessary to bid for contracts in the proposed procurement areas. Many firms told Otterburn that they believed that the areas were too large. Firms also need to merge to compensate for the reduction in fees.   Otterburn exposes the small profit margins firms are working to. It estimates that on average criminal practices are making 5%, but points out that this figure does not take into account recent fee cuts, particularly those in Crown Court cases. A fee cut of 8.75% was implemented in February this year. A further cut for the same amount is planned  by the MoJ for next summer. This cut will further undermine profitability and led to Otterburn to call for the second cut to be delayed.   By moving to publish the new consultation within days of the judicial review judgement, Justice Secretary, Chris Grayling, is signalling his determination to force through his plans for criminal legal aid prior to the general election. Its a highly risky strategy, as much of the detail of the tender process, including the selection criteria,  has yet to be finalised. A process, which will ultimately lead to two thirds of firms facing merger or closure, is also almost guaranteed to throw-up legal and other unexpected problems.   The tender results were previously due to be announced in early February next year. This latest consultation is likely to put this back to early March. According to the parliamentary convention of purdah no major policy decisions are supposed to be taken within six weeks of the general election. This gives Grayling until 24th March to get the tender decisions through. As well as being a tight deadline to do this by, it risks the controversy  over the potential closure of many criminal legal aid firms spilling over into the general election campaign.