Coppinger: We already receive some firms’ unused levies
Repurposing large law firms’ unused apprenticeship levies was this week put forward as a more practical option than a levy of wealthy law firms to support access to justice initiatives.
Unused levies are currently forfeited to the government, although employers that pay them – those with wage bills exceeding £3m – can choose to transfer up to 50% of their levy funds each year to other businesses to pay for their apprenticeship training.
Speaking at an event in London organised by the Legal Services Consumer Panel, Eddie Coppinger, chief executive of University House Legal Advice Centre in London, said some large law firms already did this, enabling his clinic to train up lawyers of its own.
But he went on to suggest that, rather than forfeit any unused levy back to HM Treasury, “it gets repurposed” to support access to justice initiatives.
He said this would “work better” than a levy on profits or turnover.
Fellow panellist Dr John Sorabji agreed that “piggybacking” off the apprenticeship levy would be a simpler option.
The event was held following a report published last spring [1], Regulatory Leadership on Access to Justice, by the Legal Services Consumer Panel in collaboration with the Legal Services Board.
Commissioned from Nottingham Law School, the report’s recommendations included exploring alternative funding streams for access to justice work, such as interest on client accounts and levying wealthy law firms.
The event focused on whether these were practical options but attendees recognised multiple problems with a levy.
Dr Sorabji, a barrister and academic, traced the history of the idea back to a proposal by eminent solicitor Sir Geoffrey Bindman in 1994, which was revived briefly in 2015 by Michael Gove when he was Lord Chancellor, and then again in 2023 in the notion of a national legal service [2] to replace legal aid.
Then last year, the Civil Justice Council working party on litigation funding – which Dr Sorabji co-chaired – said the government should consider whether to introduce an access to justice fund, funded by a small percentage of the profits from litigation funding and lawyers’ contingency fee arrangements. It would back early legal advice and alternative forms of dispute resolution.
Dr Sorabji told the event: “So whether it’s the general principle model or whether it’s a variant, there is a focus, over and over again, that a specific levy on the legal profession should be something that is necessary and something that should be looked at.”
The benefits of a levy on firms included that it would provide “systematic” provision across the country, meaning initiatives were not reliant on particular law firms doing pro bono or supporting charities.
“The most obvious advantage is that you could start to make inroads into unmet legal need almost immediately if a levy was imposed, because the money would flow in.”
At the same time, there was a principled objection – that it was the state’s responsibility to ensure access to justice.
Further, said Dr Sorabji, “this isn’t a holistic approach. It might be another way of ensuring that a little bit of positivity is achieved, but actually the system itself overall doesn’t get any better”.
There was also the practical question of what a small or modest levy would be – something that may be modest from the perspective of a large commercial law firm “isn’t necessarily going to be modest overall”.
He went on: “And might the imposition of a levy have an adverse effect on the attractiveness of the City of London as a venue for the provision of legal advice?”
The barrister added that there was no principled reason why any levy should not apply to all law firms.
Discussions following the presentations showed little support for a levy, with participants questioning why lawyers – who already paid billions of pounds in tax – should be singled out, and fearing that government would just reduce the money allocated to the Ministry of Justice.
There were also practical issues about how any levy would be set and administered.
Lola Bello, head of the Legal Services Consumer Panel, explained that it was coming from the perspective that the government would not commit “a big pot of money” to access to justice or commission a structural review of how it was delivered.
In lieu of that, the panel wanted to explore other funding streams but she stressed that it did not have a position on this at the moment.
The Ministry of Justice is currently consulting on a client account interest scheme, the closing date for which is Monday.