Law: Legal aid, takeaway-style: Franchising could spread from shopping malls to solicitors' practices. But first it must meet with the Law Society's approval, says Sharon Wallach

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The Independent Online
THE ISSUE of who regulates the solicitors' profession has been raised again this week by the Legal Aid Board's publication of a plan to franchise legal services. A national system of contracts is proposed, under which lawyers would undertake legal-aid work, following quality criteria on efficient working practices and the handling of individual cases.

An experimental franchising scheme, which has been running in the Birmingham area since 1990, was supported by the Law Society after tough negotiations to improve terms for its members. But the society's head of legal practice, Andrew Lockley, says: 'The pilot was carried out in different circumstances and with different criteria. It is important to emphasise that we are therefore having to look afresh at franchising.'

The aim of the scheme, the board says, is 'to work in partnership with the profession to provide an accessible and quality-assured legal-aid service to clients, giving improving value for money to the taxpayer'. Reduced costs and improved service can be achieved by a series of administrative measures, it says, including delegation of some powers traditionally held by the board. In some circumstances - yet to be approved by the Lord Chancellor, Lord Mackay of Clashfern - franchised solicitors would be able to decide whether to grant legal aid.

The quality-assurance standards would apply to the handling of cases and management of law practices. This encompasses case management, recruitment, training and supervision of staff, client care, forward planning and accounting. The board would monitor the scheme by audits of quality standards and confidential file inspections. Measures to control case costs, and the introduction of a review procedure where contracts have been refused or revoked, are proposed.

Until the full package has been placed on the table the Law Society is declining to say whether it will support the proposals. It does make it clear, however, that several conditions must be met before it will accept national franchising.

It says that clients must remain free to instruct non-franchised firms for legal-aid work. And that additional responsibilities of franchised firms must be reflected in adequate preferential terms (payments in advance, faster payment after completion and higher payment for higher-quality work).

The society insists that qualification for franchise status must be based only on a firm's ability to provide a good-quality service. Fears are being expressed, by the society and the profession at large, that in practice the qualification may operate to the detriment of small firms and those who undertake only a small volume of legal-aid work. 'We are far from happy about this,' Mr Lockley says. 'It will be a major item of debate between us and the board over the coming months. All firms that choose to do legal-aid work should be available to the public.

'A further point is that, if there are criteria for franchising, and we accept in principle that there must be, they must be objective and such that any firm is able to meet.'

The society remains unhappy about the dangers of regulatory authority slipping from its grasp. 'We are determined to ensure that these proposals genuinely lead to a better deal for clients and for practitioners, rather than restricting access to justice or imposing uniformity,' says John Appleby, the chairman of the society's courts and legal services committee. 'The board must expect to be challenged on whether (its) interests always coincide with the interests of solicitors' clients.' According to Mr Lockley, the board's interests include serving the public purse. The Law Society may not be a popular regulator, he says, but it is bound to be more popular than the Legal Aid Board, because of that potential conflict of interests.

A society working party is soon to publish a new code of legal practice management standards, building on existing rules. Announcement of this was brought forward, Mr Lockley says, in recognition of the sensitivity in the profession about the regulation issue. 'The board has indicated that it is very interested in the work, and of course we are consulting it throughout the process and will put something to it formally in due course.

'We are also bringing in others interested in the standards of legal services: the Confederation of British Industry, unions, lending institutions, local authorities, the Crown Prosecution Service. A large proportion of the profession's work comes from members of those representative bodies and their clients. We are very anxious to meet their requirements at one go.

'What we will do is draw up a core set of standards. The major players may have additional requirements, but they will all have the same core issues on which they need to be reassured; for example, financial management and client care.'

Monitoring of franchisees' costs would continue after the granting of a contract. This would involve comparisons of a firm's bills with those of other local suppliers of services. Could this lead to solicitors carrying out work at a loss in an attempt to retain their franchise? Mr Lockley says: 'It may be a cause for concern, though we are pleased to note that the board is saying that, if a firm's cost level is higher than average, gentle inquiries would be made before drastic action were taken.

'The most important point is that we do not think it appropriate for franchising to be used as a crude mechanism for cost-cutting. That would not fit in with the Legal Aid Board's objective of raising the quality of work generally.'