Lawyers and regulators oppose 10% rise in LeO’s budget


Complaints: LeO still has significant backlog of cases

The profession has come out strongly against Legal Ombudsman (LeO) plans to increase its budget by 10%, arguing that throwing more money at the service has not proven especially successful to date.

“We know that LeO is having to resolve an increased number of complaints, but simply employing further staff has not yet significantly reduced the number of complaints nor wait times,” the Bar Council said.

In its response to a consultation on LeO’s 2025/26 business plan and budget, the Law Society agreed that previous years did not show that further investment in resources resulted in improvement.

It demanded: “What is the evidence that the requested budget increase would lead to more efficient and effective handling of complaints?”

LeO proposed a 10.2% increase in its budget, or £1.8m, as it struggles to bring down the longstanding backlog of complaints in the face of high ongoing demand for its services.

It also suggested doubling the case fee – charged for complaints resolved in the consumer’s favour where the service provider did not take reasonable steps to resolve it – to £800.

Most of LeO’s budget comes from a levy on the regulated legal profession, which it said was letting consumers down with poor service.

The Bar Council observed that LeO has requested budget substantial increases for successive years – 13% for 2021/22, 5.8% for 2022/23 and 9.6% for 2023/24 – and said that, following recruitment drives, “it should be well staffed”.

“Work to improve retention, for example through the new induction programme, should have reduced staff churn. If LeO is still unable to manage the current caseload without additional investigator resource, we question whether a new strategy is needed.”

The Law Society welcomed the increased number of complaints resolved and reduction in cases awaiting allocation to an investigator.

“[But] we remain concerned about the pace of change, high sickness levels, ongoing failure to meet forecasts and LeO’s objective to undertake additional work when delivery of its core statutory function still requires significant improvement.”

A theme among responses opposed LeO’s intention to expand work on learning, insight and transparency while performance continued to struggle. “This would divert resources away from the core business of handling complaints, but also requires a further increase in budget which we cannot support,” the Bar Council said.

Regulators also opposed the rise. CILEx Regulation considered it “disproportionate, particularly following a similar increase last year. We would suggest that LeO re-examines its budget and looks for savings in other areas that can be reallocated rather than making a demand for more resource”.

The Council for Licensed Conveyancers (CLC) said that, despite certain improvements, “we still have concerns regarding value for money, overall efficiency and most significantly, whether the proposed investment (time, significant financial investment and resourcing) in achieving ‘enhanced transparency’ of LeO’s ombudsman decisions, i.e. publication of redacted decisions, is indeed going to enable LeO to achieve this strategic objective and convey ‘key learnings more effectively to a wider audience’.”

The CLC noted that, on 2022/23 figures, this would mean publishing details of around 3,400 decisions which went to a final ombudsman decision, the resource implications of which would be huge.

The CLC also questioned whether LeO had too low a gateway for accepting complaints, given that nearly half of its investigations resulted in a finding that the complaint was handled adequately by the provider.

More broadly, while all supported greater transparency in principle, the responses indicated widespread doubt about whether publishing individual decisions, after needed redactions, would achieve what they were supposed to.

“It is difficult to imagine consumers reading detailed decisions,” said the Bar Council. “It could cause confusion amongst consumers as complaint decisions are determined on their facts and are not binding on precedent.”

There was cautious support for doubling the case fee to £800. The Bar Council said LeO should first research on possible negative impacts. “We question for example, whether smaller chambers or sole practitioners might be encouraged to resolve a complaint early, even if there is no merit in the complaint, to avoid the increased case fee.”

For the Law Society, no more than an inflationary increase could be justified. “Certain work types inevitably attract more complaints. Firms doing legal aid work or even residential conveyancing work are often working at marginal rates once running and compliance costs are factored in…

“Doubling the case fee could result in some firms considering that such work is no longer viable.”

It could also “encourage firms to settle speculative complaints for commercial reasons”.

While CILEx Regulation backed the fee doubling, especially if it reduced the amount required through the levy that each regulator pays to fund levy, the CLC insisted the increase should not be introduced simply to reduce the levy “for presentational reasons nor to disguise total costs per case”.

The Bar Council opposed the initiative for LeO to create and implement model complaints handling procedures and standards for first-tier complaints. “This should be within the remit of the regulator,” it said.




Leave a Comment

By clicking Submit you consent to Legal Futures storing your personal data and confirm you have read our Privacy Policy and section 5 of our Terms & Conditions which deals with user-generated content. All comments will be moderated before posting.

Required fields are marked *
Email address will not be published.

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Blog


Managing risk: a guide for law firms

Traditional risk management approaches typically focused on responding to incidents after they have occurred. Best practice today demands a more forward-thinking approach.


Legal tech in 2025: Data, data and more data management

Even the staunchest sceptics are now recognising that generative AI is here to stay. But was 2024 the year that the AI ‘hype bubble’ burst?


Understanding mid-sized law firms’ priorities in 2025

Mid-tier practices are looking to grow both organically, or by a merger/takeover, and our survey revealed that 17% of firms are intending to pursue an acquisition strategy over the next 12 months.


Loading animation