The Law Society has spoken out against government plans to impose on the Solicitors Regulation Authority (SRA) a duty to promote economic growth, which it said threatened the independence of the profession.
It also opposed proposals from the Department for Business, Innovation and Skills to require regulators to appoint small business appeals champions to act as go-betweens with the profession.
Though the SRA is supporting the moves – so long as they are imposed on all the legal services regulators, rather than just itself, as has been mooted – the Law Society argued that the SRA is already subject to eight regulatory objectives under the Legal Services Act 2007.
“Some of these are directly relevant to growth, including the duties to support the rule of law, to promote competition in the provision of legal services and to encourage an independent, strong, diverse and effective legal profession.
“The society believes that balancing the existing eight objectives, many of which create a tension with other objectives and are not prioritised within the Act, is already difficulty for legal sector regulators.
“While the society supports the need to promote economic growth, it doubts that the imposition of this objective will make any significant difference to the work of legal regulators, and that it is likely to be lost in the discussion of the other eight objectives. Indeed, the additional objective may be self-defeating by adding to the debate and delaying reform.
The society went on to caution that the government should not seek to bypass the independence of the profession by “in effect monitoring regulators and, inevitably, seeking to second-guess what may be finely balanced decisions”.
It added: “It is inappropriate for the government to have this power in respect of the legal profession to directly impose an additional objective.”
The main role of small business champions is to review the effectiveness of the relevant regulator’s procedures for handling and resolving complaints and appeals, and to present an annual report to the Secretary of State.
The society said the independence of the profession meant it was not appropriate for the champion to report to a minister.
It added: “The SRA has in place a complaints system, though this is not widely known about within the profession. However, within the legal sector, regulatory issues do not normally relate to complaints and appeals processes but rather with policy decisions and practices introduced by the regulator. Therefore it is not clear to us how this would, in fact, help in practice.
“Regulators have many factors to take into account in reaching decisions and will always be able to find a justification for a process that is unpalatable to small businesses. This is particularly the case for the legal sector, where there are multiple regulatory objectives to which the government is proposing to add.
“In practice, we doubt whether the role envisaged for the champion will provide benefits to justify even the relatively small costs envisaged.”