Report on Managing Legal Aid.pdf (310.89 kb)

Executive Summary

1. The Public Accounts Committee (PAC) supports reforms directed at improving the legal aid systems that ensure access to justice for all, regardless of social background.  In 2011 the PAC report on Managing Criminal Legal Aid made recommendations to introduce significant reform of the legal aid system and to establish effective financial controls over payments.  Reforms have not been implemented effectively and at an average annual cost of £102 million since 2011, the costs of legal aid remain unacceptably high. 

2. The Committee considers that the lack of progress in implementing many of the recommendations contained in its 2011 report clearly demonstrates the Department and the Agency’s continued failure to deliver an economic, efficient and effective legal aid system in Northern Ireland.  In particular, the failure to implement a statutory registration scheme for legal services providers is entirely unacceptable and impacts significantly on the reform programme.  The absence of a scheme means that the legal aid system lacks a basic mechanism to ensure quality of service and to deliver accountability and transparency in the use of public money. 

3. Non-criminal legal aid has not been reformed to date resulting in excessive costs being incurred year after year due to a complex mix of statutory and non-statutory fees with few paid at a standard rate.

4. The Committee does not believe the Department has conducted a serious examination of the potential benefits that could be derived from contracting with providers for publicly funded legal aid in Northern Ireland.  In the Committee’s view, in considering the necessary reforms to improve the legal aid systems, the Department must test fully the scope for generating savings from contracting while taking account of access to justice considerations.

5. For full civil legal aid cases heard in the High Court, the remuneration to be paid to legal representatives is determined by the Taxing Master who adjudicates on around £20 million of fees annually.  The Taxing Master is an independent judicial figure and so sits outside the usual public sector accountability structures.  These arrangements lack transparency and there is no line of accountability from the Taxing Master through the Accounting Officer to this Committee.  The Committee is alarmed at the extent to which legal representatives have had their claims reduced as a result of the Taxing Master’s deliberations, a reduction of £9 million (13 per cent) in claims with a total value of £69 million since 2013-14.  In the Committee’s view, this represents an unacceptable level of claims submitted by the legal profession that are disproportionate or not reasonably incurred.

6. The Agency’s management information systems are archaic and not fit for purpose.  This is an inadequate basis for running the service and has an adverse impact on every aspect of the Agency’s work.  In particular there is an inability to prepare robust provisions for future legal aid costs.  Despite assurances of progress given to the Committee in 2011, the first phase of a new digitised management information system will not be in place until 2018 at the earliest. 

7. The need for pro-active counter fraud arrangements was a key recommendation in the Committee’s 2011 report.  The Committee is of the view that no effective counter-fraud arrangements exist within the Agency and there is not a strong culture of fraud awareness.  The Agency’s fraud unit is under-resourced and while internal controls have been established, they are not risk based and are not adequate to prevent and detect fraud.

8. The Departmental Accounting Officer is responsible for ensuring the effective and efficient delivery of legal aid services in Northern Ireland.  The Committee is of the view that the long-standing issues it has identified stem from a failure of leadership to drive forward much needed reform.  The Committee considers that there is a clear need for the Accounting Officer to instigate a capability review of the Agency’s leadership team, including the Department’s sponsorship arrangements, to ensure that it is adequately resourced and has the necessary skills, experience and culture to deliver a major change programme.

Summary of Recommendations

Recommendation 1

The Committee recommends that the Department fully tests the scope for generating savings from contracting legal aid services in Northern Ireland.

Recommendation 2

The Committee recommends that the Department advance the reform of legal aid, focusing on:

• reforming non-criminal legal aid remuneration rates and introducing standard fees as a priority.  This should include the introduction of effective controls over the cost of expert witnesses;
• establishing a statutory registration scheme for all providers of publicly funded legal services; and
• establishing an effective management information system in the Legal Services Agency to support the process of reform. 

The reform programme must address all the above issues and be supported with a concise action plan including an explicit timetable and milestones for delivery.  Further delay must be avoided and the Committee will seek an update on progress in 2017.

Recommendation 3

The Committee recommends the Department conducts a review of how expenditure currently adjudicated by the Taxing Master can properly be brought under the purview of the Accounting Officer.  In the meantime, the Legal Services Agency must have a complete and detailed analysis of adjustments to claims to establish possible patterns of over claiming.

Recommendation 4

The Committee recommends that the Agency establishes a method of measuring the level of fraud within the legal aid system and develops proactive risk-based counter fraud measures.  These measures should address specific issues raised continually by the C&AG and build a strong culture of fraud awareness within the Agency.  The Department must demonstrate an active role in overseeing this work, and drive the establishment of effective counter-fraud arrangements within the Agency.

Recommendation 5

The Committee recommends that the Departmental Accounting Officer instigates a capability review of the Agency’s leadership team, including the Department’s sponsorship arrangements to ensure that it is adequately resourced and has the necessary skills, experience and culture to deliver a major change programme.