Legal Services Board - New Labour's Legal Services Act

Legal Services Board - genuine regulation? Or yet more New Labour control freakery?

The Legal Services Act recently received royal assent.

The Act has been touted by the Government as a "liberalisation of the legal services market" in England and Wales.

Sounds great in theory. But what does it mean in practice?

Many commentators believe that the effects could be severe for many traditional high firms of solicitors. Their work will be taken over by supermarkets, banks and other large organisations.

Is this in the best interests of clients?

All solicitors owe a professional duty to act in the client's best interests. However if legal practices are taken over by commercial organisations, then this will change. Directors of companies owe a different duty, namely to act in the best interests of their shareholders.

So what happens if the professional duty owed to the client conflicts with the commercial duty owed to shareholders? Will deserving clients be turned away in future, because there is no profit to be made?

Since when have banks and supermarkets been concerned about social justice?

The creation of a "Legal Services Board" is one of the Act's provisions. Originally the government wanted the power to appoint all the members of the Legal Services Board. The implications for independence and impartiality were obvious.

Furthermore the government wanted the Legal Services Board to have the power to sweep aside the front line regulators including the Law Society if necessary, and regulate solicitors itself.

Thereafter the government met stiff opposion from a joint committee of Lords and MPs, chaired by Lord Hunt of Wirral. He said the level of government involvement in the Legal Services Board, was "potentially damaging to the independence of the legal profession".

The above provisions have since been watered down. We have now been promised a "light touch" regulator.

But will this be heeded in practice?

The Law Society believes that government interference in the regulation of the legal profession could jeopardise the international reputation and success of UK law firms.

And what about personal freedom?

The Labour government has introduced much "public order" legislation. Certain freedoms have been reduced. It is now more difficult to stage a peaceful protest. Suspects can now be held longer without charge. The list goes on. In fighting to defend their clients against such restrictions, some solicitors find that their work can bring them into conflict with government policy.

It remains to be seen whether regulation from the Legal Services Board really will be "light". What happens if the govenment disapproves of a particular solicitor? Will the Legal Services Board intervene and target that individual?

Make no mistake, Labour's Legal Services Act has major implications for our basic freedom. A healthy democracy depends on a free judiciary and and independent legal system. Will these survive the Legal Services Act?

Will the Legal Services Board mean genuine regulation?

Or yet another example of government control freakery?

You decide.

Boris Kremer, council member, Hampshire Incorporated Law Society.

5 December 2007