Last LSC annual report and accounts
Increase in LSC running costs
The end of an era was marked by the publication in June of the last annual report and accounts from the Legal Services Commission (LSC):
Legal Services Commission annual report and accounts 2012–13 (‘2012/13 accounts’).
1Available at: www.justice.gov.uk/publications/corporate-reports/legal-services-commission. The LSC was replaced by the Legal Aid Agency (LAA) on 1 April after its abolition under the Legal Aid, Sentencing and Punishment of Offenders Act 2012. While the financial results have improved since 2011/12 as the accounts were not qualified, there was a 15 per cent drop in the number of civil legal aid cases and a two per cent drop in the number of criminal legal aid cases:
Legal aid statistics in England and Wales. Legal Services Commission 2012–2013 (‘2012/13 statistics’) (June 2013, page 2).
2See note 1. The cost of running the LSC also increased.
Increase in administrative costs
It is the first time since 2008/09 that the LSC’s accounts have not been qualified due to errors made in respect of payments to legal aid providers. In 2009/10, the National Audit Office (NAO) estimated that £78.6m (3.2 per cent of the LSC’s total expenditure) had been paid in error (
Legal Services Commission annual report and accounts 2009/10, page 38). This was well above the one per cent level permitted by the NAO. After introducing a stricter regime of auditing legal aid providers’ checks on the financial eligibility of clients and the recovery of payments made in error, in 2012/13 the LSC succeeded in bringing the estimated level of errors down to below the one per cent target. Over the year, the LSC issued 1,218 contract notices requiring providers to improve their procedures for claiming payments and terminated more than 121 contracts (2012/13 accounts, page 24). Matthew Coats, the chief executive of the LAA, and former head of the LSC, welcomed the results saying that success in bringing the estimated error rate down was due to the ‘sustained amount of hard work by LSC staff and ongoing close engagement with providers of legal aid’.
3See: www.justice.gov.uk/legal-aid/newslatest-updates/civil-news/nao-removes-qualification-of-lsc-accounts.The cost of administering legal aid increased from £82.1m in 2011/12 to £111.2m in 2012/13. This includes over £3m spent on redundancy payments to 53 staff (2012/13 accounts, pages 15 and 93). The most senior member of staff to take voluntary redundancy was Helen Riley, the former Director of Case Management, who left in October 2012 and received a severance payment of £156,000 (2012/13 accounts, page 35). The number of redundancies was lower than the previous year in which 113 people at the commission were made redundant (Annual report and accounts 2011–12, page 96). The increase in administrative costs is surprising; for example, staffing costs increased by just over £6m in the last financial year, despite the redundancies over recent years (2012/13 accounts, page 93).
Downward trend in cases
LAG is concerned to see that in the last three years the number of people helped by the legal aid system has declined by 20 per cent overall (2012/13 statistics, page 2). Most of this reduction has been in civil legal aid cases and it is in the social welfare law (SWL) category (community care, debt, employment, housing and welfare benefits) that the biggest falls have occurred. From just under half a million SWL cases at their peak in 2009/10, the number of cases had dropped to 293,319 in 2012/13 (2012/13 statistics, page 34). The following table breaks down the figures for legal help and certificated cases for the five categories of SWL:
| 2009/10 | 2010/11 | 2011/12 |
2012/13 Welfare benefits | 143,865 | 120,042 | 110,771 |
88,618 Debt | 147,194 | 128,179 | 109,427 |
82,117 Housing | 153,106 | 127,840 | 118,909 |
100,253 Employment | 31,796 | 25,330 | 20,324 |
16,148 Community care | 9,703 | 7,060 | 7,448 |
6,183 Total | 485,664 | 408,451 | 366,879 |
The reducing number of SWL cases is surprising given the continuing economic difficulties and the number of cases reaching the courts and tribunals system. For example, in the quarter ending 31 December 2012, there had been a 48 per cent increase in the number of appeals brought to the Social Security and Child Support Tribunal when compared with the same quarter in the previous year.
4Tribunals statistics quarterly 1 October to 31 December 2012, Ministry of Justice, March 2013, page 8, available at: www.gov.uk/government/uploads/system/uploads/attachment_data/file/177045/quarterly-tribs-q3-2012-13.pdf. Citizens Advice reported increasing numbers of enquiries in the first three quarters of 2012/13. However, in the final quarter, bureaux capacity to deal with specialist cases was reduced as they prepared for the withdrawal of legal aid from much of SWL.
5Advice trends. England and Wales. Q4 2012/13 (January to March), available at: www.citizensadvice.org.uk/advice_trends.htm. LAG would conclude that the reduction in SWL cases supported by legal aid is due to changes in the system, such as the reduction in matter starts, rather than a decrease in the numbers of people needing assistance.
According to the LSC, over the last three years the figures for immigration cases have also been reducing by an average of 18 per cent each year. In contrast there has been a steady increase in mental health tribunal cases (up by almost 17 per cent since 2007/08) (2012/13 statistics, page 17).
Overall expenditure on criminal legal aid was £975.1m, down from £1.1bn in 2011/12 (2012/13 accounts, page 15). Practitioners have been telling LAG for some time that the number of cases in police stations and magistrates’ courts has been falling and this is mainly due to the use of summary justice measures by the police. The most striking reduction is in higher criminal court work, referred to as Crime Higher by the LSC. The number of cases in the Crown and higher courts had been constant in recent years, but the LSC reports a 12 per cent reduction in Crime Higher cases in 2012/13 (2012/13 statistics, page 2). This calls into question whether the reductions in criminal legal aid proposed by the Ministry of Justice through the introduction of price competitive tendering are necessary.