Hampshire Law Society - Best Value Tendering
Monday 20 July 2009 www.lawsociety.org.uk/mediacentre
BVT proposals - full evaluation welcomed - but still too many risks says Law Society
Commenting on the LSC announcement today on Best Value Tendering, Paul Marsh, Law Society President, says:
"The Law Society lobbied hard for a proper pilot and full evaluation of the proposals – so we are pleased that the LSC has promised that decisions on any roll out will not be taken until full pilots have been evaluated - not before 2013. This decision is a testament to the strength of the arguments put forward in the responses of the Law Society and all the other organisations who responded to the consultation. We are pleased that the LSC has adopted many of the suggestions in relation to the pilot model that were made in the economic report by LECG which was commissioned by the Law Society.
The Law Society also welcomes the acknowledgement of the need for solicitors to be able to follow their clients out of area, although it remains to be seen whether the 10% tolerance proposed will be sufficient.
However, the Law Society says that whilst the LSC has clearly taken on board a number of the concerns raised by the Society and others in consultation responses, "there appears to be no acknowledgment of the potentially destructive impact on firms in the pilot areas".
"We are convinced that the pilots will have a destructive impact on access to justice in the pilot areas, and we are doing what we can to protect and support our members and their clients in those areas. It is a shame that the scheme has not been dropped altogether." said Paul Marsh
"We are disappointed to see that zero bids could still potentially be allowed, and we do not believe that the LSC has sufficient understanding to adequately safeguard against unsustainable bids during the bidding process."
The Society is also unhappy at the lack of any guarantee that prices for other, related criminal work will remain unchanged throughout the life of this contract.
The Society continues to have concerns about whether this method of tendering for legal services will be successful and about the fairness of the proposed scheme towards those firms in the pilot.
"We are extremely disappointed at the lack of any support whatsoever for firms that are forced to exit the market, given that the LSC is a monopoly supplier and that firms in those areas have no alternative if they do not get a contract to continue undertaking this work. For some lawyers in this position, the result will be personal bankruptcy. It is not acceptable that people should be bankrupted by the operation of a pilot scheme. We will do what we can to lobby the LSC extensively to ensure that the pilots in Manchester and Bristol do not adversely affect firms in those areas or the supply of legal services." said Paul Marsh
Brief Note of the Concerns of the Law Society re: BVT 3 June 2009
The following concerns are set out in more detail in the main body of our response:
• It is vital that any pilot scheme is properly evaluated. The Legal Services Commission has reneged on its commitment to undertake a full assessment of the impact of any pilot, prior to any decision being taken on national implementation.
• The impact on firms offering mixed legal aid services is unlikely to be immediately visible. A full period of evaluation is needed to ensure that this pilot does not have the effect of restricting social welfare law advice, through the closure of mixed practices due to unsuccessful bids.
• The Government has acknowledged that the lower crime legal aid budget is under control; there is no necessity for these changes to be rushed through.
• The market for criminal defence services is unpredictable, and susceptible to significant changes within short timeframes. Many of the factors impacting on the cost of undertaking the work are external and beyond the control of practitioners, making it impossible to predict with any certainty the true cost of the work for the purpose of any competitive bid process.
• The market is extremely fragile. Many firms currently operate at marginal profits, and any reduction or loss of fee income could see many firms forced to close down.
• The ‘true cost’ of undertaking criminal defence work was examined in the benchmarking exercise undertaken of the Public Defender Service (PDS). The Government thus knows that they are currently obtaining extremely good value for money from private practice.
• There have been a huge number of recent changes in the criminal legal aid system, such as the introduction of fixed fees; means testing; the Litigators Graduated Fee Scheme – all of which were aimed at reducing costs, and none of which have yet been properly evaluated. The cumulative impact of all of these changes on both the legal aid budget and on firms must be fully understood before any further changes are introduced.
• Making savings by cutting fees yet expecting the same amount of work is not a responsible way to reduce costs. There are a number of other ways in which efficiencies and savings could be made, which we explore in our response.
• The Society has concerns about the quality safeguards proposed in the paper. The only entry measure proposed is threshold competence, and since firms that win contracts will be those that have bid the lowest, the level of quality they will be able to provide at that price is unlikely to be very high.
• The proposal to restrict own client work in each police station to those who win contracts for work in that police station is hugely problematic, given that clients are arrested in different locations, and not only those where the solicitor happens to have a contract. This is likely to result in considerable duplication of work; difficulties for clients and additional expense for the legal aid fund.
• Most criminal legal aid practitioners have no experience of competitive tendering, and there is insufficient time for firms affected to fully understand what they need to do to participate effectively in the process as set out in the consultation paper.
• Firms that do not win bids and have no option but to close down will leave a reduced number of suppliers, thereby removing any competition for any future bid rounds, should there be any. As mentioned above, this is also likely to have a knock-on effect on the provision of civil legal aid services.
• The proposal for maximum bid sizes is likely to have the effect of reducing considerably the size of contracts currently held by some firms. This artificial manipulation of the market could have adverse consequences on future supply, as many firms will have to downsize or close if they do not have access to their existing volume.
• The ‘one size fits all’ approach to niche providers is short-sighted, and risks losing the wealth of expertise and specialist knowledge that currently exists in the legal aid market.
• There must be some protections offered for firms in the ‘pilot’ areas, given the potentially destructive impact this process could have on their businesses
Law Society calls on members to respond to best value tendering consultation
Criminal legal aid is under threat like never before
The Law Society urges all practitioners, whether or not they do criminal defence work, to speak out to ensure the effectiveness and integrity of our criminal justice system can be maintained and that access to quality legal representation is preserved. Without it, the right to a fair trial, and the rule of law itself, are at risk of serious damage....
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