The board of trustees and directors of Solicitors Regulation Authority Ltd met for the first time last week after agreeing the transfer of £9m in assets to the new company with the Law Society.
The Law Society announced in April 2020  that the SRA would be hived off into a corporate entity within its group – to help comply with the Legal Services Board’s tightened internal governance rules – although the arrangement does not change the fundamentals of the relationship between the two as set out in the Legal Services Act 2007.
A paper before the SRA board last week, published yesterday, said: “A separate corporate vehicle will enhance confidence in the independence of regulation for the public and consumers from every background.”
The SRA is also in the process of applying for charitable status  for the new company, which took over the Law Society’s regulatory functions from 1 June, in a move it says will enhance its accountability, with the Charity Commission overseeing the public interest nature of the regulator’s role.
A Law Society spokesman told Legal Futures that the creation of SRA Ltd included the transfer of £9m of investments previously held as part by the Law Society group.
“We have also ensured SRA has sufficient funds to meet its ongoing operating activities and net liabilities and, subject to an independent audit, will finalise the financial aspects of the transfer before the end of the current financial year (31 October 2021).”
Its most recent accounts put the Law Society’s reserves at £62m .
The board paper said that, as a separate corporate entity with control over its finances, it now has to develop a reserves policy, as well as an investment policy to support this.
The SRA will also pay £460,000 a year to the Law Society in return for shared facilities services.
The board heard that the regulator planned to revisit this once the changes have been made to its office space, with the SRA reducing the space  it has at its headquarters at the Cube in Birmingham as part of a post-Covid move to permanent hybrid working, and closing its London office.
Work with the Charity Commission is ongoing, and the SRA is making changes to its application after being advised “to reframe the way in which we articulate our charitable objects in our articles of association”, the papers said.
“The purpose of the key changes is to better describe our charitable objects. The articles originally submitted to the Charity Commission focused primarily on the promotion of the sound administration of law.
“The reframed articles focus on: the promotion of high standards of ethical conduct amongst regulated persons; the advancement of education and training in the law; and the promotion of the sound administration of the law.”
Becoming a charity and VAT exempt will reduce the fees students taking the Solicitors Qualifying Exam will pay, “supporting social mobility and diversity within the profession”, the paper said.
Meanwhile, the SRA has appointed Liz Withers as its first head of Welsh affairs.
Former head of policy at Citizens Advice Cymru, she will lead the regulator’s public affairs and stakeholder engagement activities in Wales, including strengthening its understanding of the Welsh legal landscape and working with local consumer groups.
She will also work to establish, subject to pandemic restrictions, a new SRA Wales office.
Developing an increased presence in Wales was an objective in the SRA’s 2020-23 corporate strategy.
SRA chair Anna Bradley said: “The legal landscape in Wales is changing and we want to play our part, not only through the phased introduction of the Solicitors Qualifying Examination in Welsh but across other key areas, such as the use of technology and other ways that people can access the legal help they need.”
Ms Withers said: “I’m keen for the SRA to play an active role in the development of an inclusive and sustainable Welsh legal sector, that allows the public to access appropriate and good-quality legal advice, when and how they need it.”