David Edmonds pointed out that the phrase “oversight regulator” does not appear in the Legal Services Act. “We are a regulator with duties and responsibilities and we interpret those,” he said.
Various of the bodies the LSB regulates have accused it of micro-managing and mission creep, but writing in the LSB’s annual report Mr Edmonds said these are “wholly incorrect as a description of the work of the LSB”.
He said: “Our statutory responsibilities derive from an Act comprising 214 sections and 24 schedules. We have little scope to extend our ambit, even if we had the inclination or the resources. Parliament did not establish us simply to introduce alternative business structures (ABSs), separate regulatory and representative functions and establish the Office for Legal Complaints. These are vital foundations, but they account for only three of the Act’s nine sections.”
Mr Edmonds said the LSB’s central role is to drive “improvements in regulation across the sector”. He continued: “Oversight does not mean sitting and watching and reacting. For me, oversight means involvement and intervention, where necessary, and leadership in thinking about new ideas and directions.
“Whilst the embedding of independent regulation, for which we have been responsible, is making solid progress, let us not forget that we are operating in a sector where self-regulation was deemed by Parliament to have failed, and which no longer convinced the public that it had their interest at its core, rather than those of the providers of services.”
Mr Edmonds also predicted that the introduction of ABSs will result in “an improvement in standards of compliance in the market as a whole”, commending the efforts of the Solicitors Regulation Authority and Council for Licensed Conveyancers in using the opportunity of becoming ABS licensing authorities “to reform radically their regulatory practice”.
He added: “We want to remove restrictions and detailed rule books when they can no longer be justified and to liberate the creativity of both current legal businesses and new entrants. Access to justice can be enhanced by the development of new service models, while making sure that the incentives for ethical behaviour and the punishments of failing to behave properly are even more robust.”
Justice minister Jonathan Djanogly said: “The LSB’s oversight and support allows the legal services industry to develop new markets, seek external investment and join up with other businesses through ABSs – introducing more competition in the market place, delivering competitive pricing, higher standards of product and more choice for the consumer.
“Since the LSB was established it has played a key role in driving forward legal services reforms and helping UK legal services remain world leading. I am confident that it will continue to do so.”