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LSB to encourage comparison websites to enter the law and challenge regulators over practising fees

Pitt: LSB is an agent for change [1]

Pitt: LSB is an agent for change

The Legal Services Board (LSB) is set to make encouraging comparison sites to enter the legal market one of its goals for the next year, along with telling regulators to be clearer about how they spend the profession’s money.

A consultation on its 2016/17 business plan, published yesterday, also highlighted the oversight regulator’s push to drive down its own costs.

The business plan said: “Consumers need reliable information to help them compare legal services before they can decide which to buy. LSB and the LSCP [Legal Services Consumer Panel] have both championed the publication of regulatory data and encouraged comparison websites to consider entering the legal services sector.

“In 2016/17, we will work with market intermediaries to understand whether there are barriers, regulatory or otherwise, preventing them from entering the legal services sector. Based on advice from the LSCP, we will challenge regulators to unlock additional regulatory data to improve the choice environment for consumers.”

Last year the LSB examined the cost of regulation. “Our emerging conclusions are that the regulators need to improve their published data,” the draft plan said. “Unclear and incomplete data prevents effective benchmarking and hinders efforts to identify potential cost reductions.

“In 2016/17, we will report on the information regulators publish about their costs and ask the regulators to improve the quality and transparency of data. This will allow the LSB (and providers) to have the right information to challenge inappropriate regulatory costs.

“We will also look at how regulators treat any underspend of the practising certificate fees they collect, including analysis of the distinction between money raised for regulatory and non-regulatory activities. Improvements are needed in this area in the interests of better regulation.”

The LSB’s own costs have fallen every year since its inception in 2009 and the plan said it would reduce them by £150,000 in 2016/17 to £4.15m, meaning that the cost to each person authorised to undertake reserved legal activities and holding a practising certificate has fallen in that time from over £34 to less than £23 in the current year. The LSB intends to reduce its annual operating costs by a further £450,000 by the end of this Parliament.

The plan said: “This is a challenging target, which will mean a refocus of some activities in 2017/18 to 2019/20. We have consistently been clear that our size, what we need to do and how long we need to exist for, depends ultimately on the performance of the approved regulators in delivering regulation that is fit for purpose.”

Other activities planned for the next financial year include:

In his introduction to the draft business plan, LSB chairman Sir Michael Pitt wrote: “I was asked recently ‘what exactly does the Legal Services Board do?’ My answer was clear: the LSB acts as an agent for change, it drives regulators to modernise, deregulate and holds them to account.

“As this draft plan explains, we intend to pursue rigorously a modern and efficient legal services sector: one that better meets the needs of consumers, citizens and practitioners.”