The Ministry of Justice (MoJ) is moving ahead with the introduction of price competition and larger contracts for court-based duty solicitor advice for housing cases, despite overwhelming opposition from respondents to its consultation.
Just five out of 51 respondents agreed with the MoJ on price competition, while only seven out of 59 agreed on larger contracts.
Former justice secretary Chris Grayling planned to introduce price competition for criminal legal aid work but abandoned the attempt, after fierce opposition from the profession.
The MoJ said it had considered “very carefully” all the responses to its consultation, launched in January this year, particularly views that “consolidation coupled with price competition could lead to a diminution of quality”.
The ministry stressed that “it remains the case” that the housing duty solicitor scheme was “the only area of face-to-face civil legal advice” where it planned to introduce price competition in 2018.
The MoJ admitted that “the majority of respondents were not in favour of using price as an objective measure” and “a number of common arguments” were advanced against it, such as the potential impact on quality.
“However, having considered the alternatives proposed by respondents, the government is not persuaded that price should not be included as a criterion or that equally practicable alternatives have been proposed through consultation.
“The inclusion of price in a tender process introduces an objective element for the award of contracts, as there is to be only one successful bidder per scheme.
“Price competition will also allow the market to set the rate according to the cost of delivering the service.”
The MoJ said respondents suggested “a number of other qualitative criteria” that could be used to distinguish between bids, including proximity to the court and whether the provider operated an existing scheme.
It promised that the tender process would “use a wide range of quality measures”, including ensuring that providers were peer reviewed and that bidders had legal aid contracts for housing and debt.
The ministry was “mindful” that a number of respondents also raised the impact on ‘follow-up’ work and the distances people would have to travel, but it “remained convinced” about the need for larger contract areas.
“Throughout the term of these contracts there has been a need to re-procure services to maintain sufficient provision across all courts.
“Available data, which will be shared with those wishing to bid as part of the tender process, indicates many of the schemes have only small volumes of work and are not commercially viable for providers.
“This is leading to a lack of sustainability of these services which has been evident in the ongoing incidence of providers pulling out of contracts.
“This presents an additional cost to the taxpayer and is an administrative burden to the Legal Aid Agency.
“Larger contracts will be more commercially attractive, will better accommodate further changes to the courts estate whilst making sure that universal coverage for those needing advice is maintained.”
Many of the concerns about travel and access could be overcome through “sub-contract/agency arrangements”, allowing SME law firm to continue to be involved, either as agents or contract holders, as long as they held housing and debt contracts.
While a large majority of respondents to the consultation supported the use of sub-contractors or agents (79%), most believed that clients “with the protected characteristics of age and disability” would be negatively affected by having to travel further to see their duty solicitor.
“Respondents felt that the distance to the court in larger schemes would be disproportionately felt by poorer families who may not have the means to travel to see a solicitor whom they might want to instruct subsequent to being advised by them on the duty scheme.”
Christina Blacklaws, vice-president of the Law Society warned that there were “considerable problems” with price-competitive tendering.
“The cheapest offering will not necessarily be the best and it could result in a race to the bottom which may impact on professional standards.
“A number of providers have already pulled out of the existing contracts because they were not financially viable and this move to introduce price competition risks the same result, leaving clients without the services they need.
“A price war will not improve services and could negatively impact on clients.”
Ms Blacklaws added that the MoJ’s plans to introduce single contracts for multiple courts could increase costs without financial benefits, “especially in rural areas where the sustainability of the duty schemes is most problematic”.