Philip: Law Society’s £35m share of PC fee should be repaid to solicitors

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21 January 2016


Paul Philip

Philip: “we’ve gone out of our way to engage with solicitors”

The Law Society’s share of the practising certificate (PC) fee should be repaid to solicitors if the Solicitors Regulation Authority (SRA) becomes fully independent, the regulator’s chief executive has said.

Paul Philip told yesterday’s board meeting that the society’s share amounted to around £35m, or £250 for every solicitor.

He was responding to comments yesterday by Catherine Dixon, chief executive of the Law Society, in an exclusive interview with Legal Futures, arguing that the society’s public interest activities justified its share of the fee.

The Treasury outlined plans to make legal regulators fully independent from their regulatory bodies at the end of last year.

Mr Philip said if the government went ahead with the move, the SRA would “look at value for money for the profession and driving down cost”.

He went on: “The £35m that goes to the Law Society, £250 for each solicitor, should be returned to the profession. This is something we would very much consider if we became independent.”

At a press briefing after the board meeting, Mr Philip added: “If we were to be independent, what difference would it make?

“At the moment, £35m goes directly to the Law Society – not to something directly relevant to regulation of the profession. It’s a fact of life.”

Mr Philip said he did not agree with Ms Dixon’s arguments that the international standing of the profession would be diluted if the regulator was fully separated from Chancery Lane.

“I personally think the opposite is true. We believe that the international standing of the profession is fundamental.”

On training, he described the society’s argument that it should award the title of solicitor as “simply wrong”.

However Mr Philip agreed with the society on the importance of “close engagement with the profession”. Citing the SRA’s ‘question of trust’ campaign, he said it would be a “fundamental part of our modus operandi” if the SRA was fully independent.

“We’ve gone out of our way to engage with solicitors on the ground,” he added.

Enid Rowlands, chair of the SRA, said: “It is very much in the public and the profession’s interest for the regulatory body to be separated from the representative body. Nobody would say the BMA is not a powerful and influential body.”

Ms Rowlands went on: “We regulate in the public interest. If you ask a member of the public, they would probably think we are already independent.

“We have the ability to tax the profession. People should know how their money is actually being spent. It should certainly be transparent and show that we are doing things in a cost-effective way.

“People should be allowed to pay for professional representation if they wish to have it.”

She rejected arguments that the SRA’s training plans for solicitors, including a central assessment test, would drive down standards.

“Why should we want to drive down standards? It’s nonsense. What we’re proposing is at least as tough and probably much tougher.”

Ms Rowlands described the debate on independence as “quite fast-moving” and said yesterday was the SRA board’s “first chance” to have a full discussion.

“We’ve been consistent in arguing that the regulator needs to be separate from the representative body,” she added.

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