There are “clear benefits” in the Legal Services Consumer Panel (LSCP) remaining part of the Legal Services Board (LSB), the panel’s chair has argued.
Elisabeth Davies said the status quo allowed the LSB and the approved regulators to “access consumer insight on tap”.
Responding to a Ministry of Justice review of the LSB, Ms Davies went on: “Being embedded within the LSB does not weaken the panel’s independence. Our statutory footing preserves our independence and gives us added confidence and protection in terms of voicing our dissent.
“It means that we can represent the interests of consumers without fear or favour. The value of our statutory independence is often hidden as we influence the LSB’s thinking before it is ready to test this with stakeholders.”
Ms Davies said separation from the LSB could lead to “competing demands on its time” in a way inevitably faced by organisations having to respond to “an economy-wide policy agenda” with limited resources.
“Indeed our operational budget for the year ending March 2015 was less than £40,000. It is doubtful whether such value could be achieved for a body that sits outside the LSB.”
Ms Davies stressed that remaining part of the LSB did not preclude differences of view between organisations, such as on how to improve price and quality transparency in the legal market.
The panel has repeatedly called for law firms to be required to publish average prices and most recently, responding to the Competition and Markets Authority (CMA) interim report this summer, suggested that family lawyers could be forced to work under fixed fees.
If the LSCP were to be made fully independent of the LSB, Ms Davies said it should also be “independent of providers”, and “sufficiently funded to deliver its outcomes”, with a dedicated budget.
“The legal sector is well-resourced and strongly positioned to put its case to the regulator, so a dedicated consumer voice is needed to provide the consumer counterweight.”
On the future of the LSB, Ms Davies said the panel was “of the firm opinion” that the oversight regulator should be allowed to continue until the legislative framework was reviewed and “potentially a single regulator is established to oversee the regulated sector”.
The panel chair said that “at this juncture, we would recognise that the LSB’s role as the oversight regulator would no longer be needed”.
Ms Davies praised the LSB’s “commitment to evidence-based policy”, which was needed both to “build the case for change” and provide a model for the approved regulators.
“Its recent research on the price of legal services provided much needed evidence and a starting point for the CMA’s review into how efficiently competition is working in the sector.”
Ms Davies added that she would like to see the oversight regulator follow up evidence-gathering with a “drive towards policy changes” and more consideration of the use of statutory powers to improve regulation.
The Ministry of Justice announced its “tailored reviews” of the LSB and Office for Legal Complaints last month, while stressing that it had “no intention of dropping its plans to separate the legal regulators from their representative bodies”.
On the OLC – the corporate name of the Legal Ombudsman – the consumer panel indicated that the review should look at the extent to which it has succeeded in raising industry standards.
It also highlighted its disappointment that the OLC did not apply to become a certified alternative dispute resolution provider under the EU ADR Directive.
“The OLC’s decision has led to consumers being signposted to multiple providers, leaving room for confusion. Arguably, it has also had an impact on due consideration being given to LeO’s role in handling complaints from unregulated legal services providers.”