Two tier contracts will not go ahead

The second fee cut will be suspended for a year from April 2016

There will be discussions about a new model from April 2017 and existing contracts will be extended in the meantime This is the crucial part of the statement: Firstly, thanks to economies I have made elsewhere in my department HM Treasury have given me a settlement which allows me greater flexibility in the allocation of funds for legal aid. Secondly, it has become clear, following legal challenges mounted against our procurement process, that there are real problems in pressing ahead as initially proposed. My Department currently faces 99 separate legal challenges over the procurement process, which has required us, anyway, to stay the award of new contracts at least until April. In addition, a judicial review challenging the entire process has raised additional implementation challenges. Given how delicately balanced the arguments have always been, how important it is to ensure we maintain choice and quality in the provision of legal services, how supportive HMT have been of our broader reform agenda and how important it is to provide as much certainty as possible in the face of legal challenge, I have decided not to go ahead with the introduction of the dual contracting system. I have also decided to suspend, for a period of 12 months from 1 April 2016, the second fee cut which was introduced in July last year. As a consequence of these decisions the new fee structure linked to the new contracts will not be introduced. My decision is driven in part by the recognition that the litigation will be time consuming and costly for all parties, whatever the outcome. I do not want my department and the legal aid market to face months if not years of continuing uncertainty, and expensive litigation, while it is heard. The Legal Aid Agency will extend current contracts so as to ensure continuing service until replacement contracts come into force later this year. I will review progress on joint work with the profession to improve efficiency and quality at the beginning of 2017, before returning to any decisions on the second fee reduction and market consolidation before April 2017. By not pressing ahead with dual contracting, and suspending the fee cut, at this stage we will, I hope, make it easier in all circumstances for litigators to instruct the best advocates, enhancing the quality of representation in our courts. I will also bring forward proposals to ensure the Legal Aid Agency can better support high quality advocacy. Furthermore, I intend to appoint an advisory council of solicitors and barristers to help me explore how we can reduce unnecessary bureaucratic costs, eliminate waste and end continuing abuses within the current legal aid system. More details will follow in due course. We have an ambitious programme of reform to our courts planned for the rest of this Parliament. It is designed to make justice swifter and more certain. The reforms to our legal system, including taking more work out of courts, moving from a paper-based system to a digital platform, tackle unnecessary costs and reduce harmful delay. Criminal legal aid solicitors perform a vital role in our justice system and these reforms will need the support of all in the legal profession. But these reforms also provide an opportunity for the legal profession to offer better access to higher quality advice and representation