Score one for the Law Society

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4 November 2010

Posted by Neil Rose, Editor, Legal Futures

Hayter: panel "disappointed" that change will not happen sooner

In the short time I’ve known her, the chairwoman of the Legal Services Consumer Panel, Baroness/Dr Dianne Hayter (she seems to operate under her non-enobled title), has not minced her words. However, she is perhaps being restrained when she tells Legal Futures that the panel is “disappointed” with the agreement that has been struck over the introduction of lay majorities on the boards of the Solicitors Regulation Authority (SRA) and Bar Standards Board (BSB).

The internal governance arrangements of the Law Society, Bar Council and others may be of somewhat esoteric interest to many, but they have symbolic importance if nothing else.

However, the symbolism has changed following the recent decision of the Legal Services Board (LSB) to compromise on its requirement that the boards of the SRA and BSB should have lay majorities far more quickly than the professional bodies had intended (see story).

Prior to striking these deals, the key symbolism – as I have blogged before (see here) – was about independence from the profession and truly putting the public and consumer interests first. But now, I fear, the key symbolism is that the LSB has folded in its first public stand-off with the regulators it oversees.

Rather than a lay majority by last week, as it had required, the LSB has agreed to solicitor/lay parity on the SRA board next year (and the count does not include solicitor chairman Charles Plant) ahead of a new board being appointed, as planned, for 2013. This will be achieved by adding an extra lay member. The BSB (which seems to be in control of this issue, rather than the Bar Council) is doing much the same but a bit quicker (parity sooner and a new board in place in 2012, again as planned).

Neither the Law Society nor BSB were happy with the LSB’s push to accelerate their timetables. During the negotiation process, the Law Society questioned whether the LSB was making proper use of its powers in pursuing this issue and made clear that it would consider legal action if necessary. Maybe the LSB was indeed on shaky ground?

But is this the “strength” that the consumer panel urged the LSB to show? It doesn’t look like it to me. “The panel would find it unacceptable if the frontline regulators were simply to wait for the terms of their current board members to expire,” Dr Hayter told LSB chairman David Edmonds in June.

She says now: “The panel remains disappointed that lay majorities on regulatory boards will not happen sooner. However, we draw some comfort that the principle of lay majorities has been accepted by all sides – there can be no turning back the clock on this point. What’s important now is that regulation is independent in practice as well as on paper. The panel will be closely monitoring developments to ensure this is the case.”

It is, of course, impossible to say whether the SRA or BSB would have come to different decisions had there been lay majorities in place, but my sense from observing both is that little distinction is generally made between lawyer and lay members. So the significance may well lie in the symbolism.

Given this, the LSB might be playing pragmatic politics, and who knows what went on behind the scenes (I should think talks were in the “frank exchange of views” category). Certainly the LSB has not been very forthcoming in my various requests for updates – this is clearly a very sensitive subject all round. Whatever happened, to me at least the score looks like Profession 1 LSB 0.

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