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Legal Services Act does not appear to provide stable long-term framework for regulation of legal professions: Justice Committee

The Legal Services Act 2007 does not appear to provide a stable long-term framework for the regulation of the legal professions, the Justice Committee has warned.

In a letter to the Lord Chancellor and Justice Secretary Alex Chalk KC, Justice Committee Chair Sir Bob Neill KC outlined eight key recommendations following the conclusion of the committee’s work examining the regulation of the legal professions.

The cross-party committee held two oral evidence sessions in Parliament with professional bodies and regulators.

The committee expressed concern regarding the amount of “discord and disfunction” between the approved regulators, the regulatory bodies and the Legal Services Board (LSB).

It said: “We recognise that there is relatively little appetite in the sector for far-reaching regulatory change, however, it is undeniable that the case for re-examination of the legislative framework underpinning regulation is growing stronger and stronger.”

Representatives from the Bar Council, Bar Standards Board, CILEX (Chartered Institute of Legal Executives), CILEx Regulation, The Law Society, Solicitors Regulation Authority (SRA) and Legal Services Board answered questions from MPs.

In his letter to the Lord Chancellor, Sir Bob wrote: “Overall, the professional bodies and the regulators would not welcome a wholesale review of the 2007 [Legal Services] Act and the instability that such a review might cause.

“However, in our view it would be wrong for the Government to ignore the conclusion of Professor Stephen Mayson’s independent review that many of the recent issues relating to regulation are evidence of the fundamental flaws of the 2007 Act.”

The Committee’s further recommendations and conclusions were as follows:

  • The Post Office Horizon Scandal will inevitably have damaged the public’s perception of the legal professions. "It is imperative that the public can see that the regulatory framework is robust and responsive enough to identify and punish egregious breaches of regulatory standards."
  • It is now right to carry out a review of the Legal Services Board and the Committee recommends this to the Government.
  • The Committee would like to formally request that the Government adds the role of the Chair of the Legal Services Board to those which are subject to pre-appointment scrutiny by the Justice Committee.
  • The Committee supports a review of the internal governance rules and would encourage the LSB to consider whether they should be further clarified and strengthened.
  • In regards to the merits of CILEX’s proposals, the Committee is sceptical of the argument that re-delegation and the proposed change to the titles of CILEX lawyer, from Chartered Legal Executive to Chartered Lawyer, would represent a simplification that would help consumers.
  • The Committee would encourage the Law Society and the Solicitors Regulation Authority (SRA) to take a proactive approach to the needs of in-house lawyers and to demonstrate that they understand the challenges they face at present.
  • The Committee appreciates and supports the Bar Standards Board’s prioritisation of operational improvements. However, the BSB should consider whether greater institutional independence could also help to facilitate improvements in its effectiveness as a regulator.

Sir Bob Neill MP said: “It is clear from the written and oral evidence the Committee received during the course of its work into the regulation of the legal professions that there has been a great deal of change since the Legal Services Act 2007 came into force.

“The success of the legal services in England and Wales should not deter the Government from examining the problems with the current regulatory framework. Taking the evidence in the round, the Committee has set out eight key recommendations which we call on Ministers to consider carefully and act on in good time. We conclude that it is now right to carry out a review of the Legal Services Board.”

A Ministry of Justice spokesperson said: “We are considering the Justice Select Committee’s recommendations and will respond in due course.”

Lottie Winson