Manchester Law Centres face closure

Two Manchester-based Law Centres are at risk of closing their doors to clients for good from next month as they have lost out in a tender to run legal advice services in the city.

Manchester City Council and the Legal Services Commission (LSC) decided to reconfigure the cash they currently spend on legal advice services into a competitive tender for a Community Legal Advice Service (CLAS). The tender was won by the city-wide Citizens Advice Bureau service, in partnership with private law firms and an independent advice centre. The council and the LSC argue that the new service, which will operate from six venues in the city, will provide better 'joined-up' services to Manchester residents. They now intend to withdraw funding from next month from South Manchester and Wythenshawe Law Centres. This is more than likely to force them to close.

Based in Longsight, a deprived, ethnically diverse part of the city, South Manchester Law Centre has been established for 36 years. Paul Morris, an immigration case worker at the Law Centre, told LAG that he and its 14 other staff got their redundancy notices last week. Morris fears that the Law Centre's clients will be 'driven to sharks and charlatans' if the Law Centre is forced to close. The Law Centre has launched a campaign to try and persuade the council and the LSC to continue supporting it. 'We are not going down without a fight', says Morris.

Gillian Hodges, senior solicitor at Wythenshawe Law Centre, told LAG that while the Law Centre has not issued redundancy notices to its seven staff yet, it is at 'serious risk of closing'. The Law Centre has been running for 26 years in Wythenshawe, which is one of the largest council estates in the country. The Law Centre understands that it scored higher than the successful bidders on quality, but the chairperson of the Law Centre's management committee, Bernard Caine, says the 'council and the LSC have chosen lower cost over quality and it is local residents, including our own families and friends, that will suffer'.

The Manchester CLAS along with the Wakefield CLAS, which was also announced last week, are the latest additions to the half dozen such services now up and running. The previous government and the LSC were keen to establish new CLAS, but mainly due to local councils’ fears about the continued existence of existing advice providers the idea has received little support. One of the first CLAS led to the closure of Leicester Law Centre and Gateshead Law Centre closed last year citing among other issues difficulties with operating the CLAS. Hull Citizens Advice Bureau, one of the oldest bureaux in the country, was also nearly forced to close when it failed to win a tender for a CLAS two years ago. It is now operating a much reduced service.

Paul Morris can see 'no good reason' why a service 'praised and appreciated by the community it serves' should be forced to close. No money will be saved by establishing the new service as the council and the LSC are putting the same amount of cash into it. To LAG, the policy of establishing CLAS seems to be an example of change for change's sake in the public sector. Particularly in areas in which long established services are forced to fold when a CLAS is established little demonstrable benefits are brought to clients. What is in danger of being lost in Manchester, if these Law Centres are forced to close, is experience and quality - two ingredients which are essential to providing legal services that get results for clients.

Image: South Manchester Law Centre

Social welfare law success

Birmingham-based social welfare law (SWL) firm, Community Law Partnership (CLP), has today heard that it has been granted a contract by the Legal Services Commission (LSC), after originally being turned down for one last month. The LSC has also confirmed that all civil contracts will now be extended to Sunday 14 November (see yesterday's blog). Providers will receive an additional twelfth of their new matter starts allocation to cover this.

CLP had appealed against the decision not to award a contract, but the LSC still refused to grant it one. CLP then brought judicial review proceedings against the LSC arguing that one of the selection criteria for the contracts was unfair. At an initial hearing the judge, Mr Justice Collins, said, 'I am bound to say this is a dreadful decision and on the face of it the approach [taken by the LSC] is totally irrational'. He hinted that at the full hearing, which was listed for 8 September, he would be likely to find against the LSC as he believed it was unfair to use a selection criterion linked to experience in appeals to the higher tribunal in benefits cases. CLP had argued that it did not need to take many of these cases as it generally wins its clients' cases at the lower tribunal.

LAG understands that some legal aid providers in Birmingham might have overbid for work and have now agreed to accept smaller contracts. This released cash to grant a contract to CLP. It would have been a travesty if CLP, with its excellent track record, had not continued to provide legal aid. This demonstrates that seemingly fair selection criteria can throw up some perverse results.

Uncertainty over civil legal aid contracts

Last Friday (3 September), the High Court decided that the start of the new family legal aid contracts should be delayed for a month in order for the Law Society's judicial review application to be heard. The delay will give the Legal Services Commission (LSC) time to collate evidence on the geographical areas covered by the new contracts, as a key part of the Law Society's case against the LSC is that the cut in the number of firms has left areas of the country not covered by family law solicitors. The full judicial review hearing is due to go ahead on 21 September.

LAG understands that the LSC has met with representatives from legal aid providers to discuss its interpretation of the High Court's decision on Friday. An important point yet to be clarified is whether the decision also means that contracts in social welfare law (SWL), also due to start on 14 October, should be delayed as well. The LSC had decided to run the SWL bid round with the family law one as it wanted better co-ordination of services at a local level. SWL, which consists of housing, benefits and debt work, fits well with the provision of family law services as clients often face a combination of these problems. Firms might be reluctant to go ahead with SWL contracts while there is still uncertainty over the family contracts.

It seems unlikely that the issue of SWL contracts and whether they should be delayed will be resolved before the hearing on 21 September. The Law Society appears to be taking the view that the High Court ordered a delay on all of the civil contracts including SWL, while LAG understands that the LSC believes the delay only applies to family contracts. Legal aid providers are therefore facing at least two weeks of uncertainty pending the judicial review hearing before this issue can be resolved.

At the hearing, the LSC will try to convince the judge that there is sufficient cover in each area of the country and that the bidding process was legal, but all options appear open to the court regarding its final decision, including declaring the process illegal. If this happens, the whole contract round for family law will have to be scrapped and a more open system adopted in which any firm that meets the quality threshold can undertake family law work. The middle way might be for the court to order a further delay while the appeals which many firms have lodged against decisions not to award contracts are decided. Things could look very different on the access to justice ground which the Law Society has raised in its judicial review application, if by early October a few hundred more firms have been awarded contracts on appeal.

Image: Legal Action Group

No win, no fee - no solution for legal aid

In its report, Access to justice: balancing the risks, the Adam Smith Institute last week called for legal aid to be abolished for most civil compensation claims and no win, no fee agreements to be expanded to cover those cases currently funded by legal aid. The paper is deeply flawed as it seems to be mainly informed by biased opinions on the balance of risk in civil cases (the author believes that the system is loaded in favour of claimants) and little understanding of the civil legal aid system.

Most of the civil legal aid budget, well over half, pays for family cases and a large proportion of these are related to child protection and custody disputes - impossible to fund through no win, no fee arrangements. Admittedly, the financial aspects of divorce cases could be funded in this way, but legal aid currently works as a state loan to fund such cases. The costs are covered by loans secured against property and include interest charges above the Bank of England base rate. A healthy £50 million a year currently comes back into the fund through this route.

Much of the rest of the civil litigation covered by the legal aid system includes areas of law such as housing and community care. Disputes with landlords or elderly people trying to secure help with care needs really do not lend themselves to no win, no fee arrangements. These are the sorts of cases which cannot be measured in terms of hard cash, but LAG would argue they are of a greater value as they involve the necessities of life such as keeping a family in a home. Is the Adam Smith Institute seriously suggesting that these people can reply on the 'free market' for legal redress?

This is a path which has been trodden before. Ten years ago, under the last government, a substantial part of the legal aid system was privatised. Encouraged by the Adam Smith Institute, the government abolished legal aid for most personal injury cases and replaced it with no win, no fee. This led to the scandal of parasitic claims management companies exploiting claimants by charging extortionate fees for what amounted to a referral service - so much for the free market. Fortunately, after the government was forced to intervene, regulation of these companies has now largely controlled the problem.

What remained in the legal aid system for personal injury work were medical negligence cases. These were left in because of the difficulties of funding these claims through no win, no fee - due to the costs of gathering medical evidence. LAG appreciates that this is an emotive issue as the main defendant in such cases is the NHS. Unfortunately, mistakes are made in the NHS, as they are in health systems across the world. However, taking such cases out of scope of legal aid would have a negligible impact on the overall budget (such cases take up less than one per cent of legal aid's £2 billion budget), but would have a profound effect on the few hundred people a year who rely on legal aid so that they can seek redress when things go wrong.

Law Society takes action on family contracts

The Law Society has today (20 August) announced that it has commenced judicial review proceedings against the Legal Services Commission (LSC) over its handling of the tender process for the family law contracts.

Both practitioners and the LSC were surprised by the outcome of the tender process which was announced last mouth. 1,100 firms failed to secure new contracts, leaving only 1,300 to cover the country. In contrast, in the criminal law bid round involving a similar number of firms, all except a small minority were successful in their applications for contracts which commenced last month.

LAG understands that the Law Society has been under pressure from firms which successfully bid for contracts not to challenge the tender process, but Law Society president Linda Lee argues that it has a public duty to act as it fears 'access to justice is in peril' due to the reduction in the number of firms. Lee, who took up her post only last month, said: 'In some areas of the country, vulnerable clients will now be forced to travel long distances to find a solicitor and in some areas, there will be too few firms to represent clients, causing conflicts of interest where several parties to a dispute need and are entitled to independent representation.'

LAG believes that the Law Society is right to put access to justice for the public above the interests of the large number of its members who have gained from the tender process. The essential fact remains that an overnight reduction in the number of outlets providing family legal aid services risks members of the public not being able to find a lawyer when they need one. We are particularly concerned about the availability of legal aid in domestic violence and child protection cases.

However, it is only once the results of the appeals are known (lodged by many unsuccessful bidders) that the true pattern of provision will be revealed. LAG also suggests that firms which have overbid could negotiate reduced contracts with the LSC. This move would allow more firms back into the system. We would argue that a delay in the commencement of the contracts would give more time for all concerned to gain a better understanding of the availability of legal aid locally. We are suggesting that the government and the LSC need to agree with practitioners (both winners and losers in the contract process) on a three-month hiatus for this to happen.

Image: Legal Action Group

'Carnage' as family solicitors lose legal aid contracts

LAG has just advised by the Legal Services Commission (LSC) that 1,300 out of 2,400 firms have been awarded contracts in family law. The new contracts are due to commence in October and firms were invited to tender for them by 21 April this year.

LAG has heard from areas in which the number of firms providing legal aid in family law from October will drop dramatically. For example, in Leeds, only ten firms will remain in the system, down from 35. In Stoke, six firms remain, with ten disappearing, leaving those six to cover a city with a population of just under a quarter of a million.

'From where I am sitting, it looks like carnage out there,' said Carol Storer, director of the Legal Aid Practitioners Group. She is advising those firms which have not secured a contract to appeal against the decision. If many firms follow this advice, it could be some weeks before it is known which firms will be providing legal aid under the new contracts.

To select between firms, the LSC scored them against criteria such as quality of work and having a permanent office in the area in which they want to provide services. One of the key criteria was employing experienced staff to supervise and undertake the work. For example, points were awarded for having a member of staff accredited by the Law Society's Children's Panel. LAG understands that many firms have applied without having the necessary staff in place and are relying on recruiting them before the new contracts commence. This has led to accusations by some losers of underhand tactics by successful firms.

The Law Society believes that the level of refusals for family contracts is far higher than either the LSC or the Ministry of Justice envisaged and has today written to the legal aid minister, Jonathan Djanogly. It is asking him to consider whether the market can cope with 'this degree of restructuring' without compromising the availability of family legal aid services for members of the public.

Social welfare law
The LSC has advised LAG that it believes around 70 per cent of existing social welfare law providers will be allocated new matter starts (NMS). It is undertaking 'due diligence checks' in five areas and will confirm the numbers of providers which have been successful in obtaining NMS once these are complete. LAG has spoken to a number of providers, including Simon Harris, chief executive of Stoke-on-Trent Citizens Advice Bureau: 'The bureau was allocated virtually everything we asked for. Overall, we feel quite relieved.' The bureau has contracts in housing, welfare benefits, debt, immigration and employment.

Image: Legal Action Group

Citizens Advice seeks divine intervention?

Fear stalked the campus of York University, along with Church of England clergy, at the Citizens Advice Bureaux northern conference last week. Bureaux from northern England were meeting for their annual get together, under the cloud of impending cuts.

A potentially cataclysmic funding storm is brewing for the bureaux as they await the results of their tenders for civil legal aid contracts from the Legal Services Commission (LSC). Many of the bureaux currently undertake advice work in debt and welfare benefits under contracts with the LSC. Some of the larger ones also have contracts in other areas of work, for example, Gateshead Citizens Advice Bureau works in immigration, employment, benefits, debt and is looking to expand into family law. The results of the new tenders for the contracts, which commence in October, were due to be announced on the second day of the conference last Friday (9 July). However, the LSC seems to be in the midst of administrative meltdown and has had to delay advising bureaux whether they have a contract or not. This has left many on tenterhooks, fearing they will have to make staff redundant in the coming months and reduce their opening hours to the public.

Some managers and trustee board members gathering in York believe that up to 80 per cent of their funding could go in the next few months. One manger from a bureau in Lancashire told LAG that it could lose nearly £800,000 in contract cash by April next year, leaving it with less than £100,000 in funding. Like many, this bureau potentially faces losing its legal aid contracts as well as central government funding. Money given to Citizens Advice by the last government to help it cope with the extra work caused by the recession is due to run out by March 2011, as is cash from the Financial Inclusion Fund (FIF).

The FIF was established in 2006 by the previous government. The total fund allocated was £120m and it was intended to tackle debt and money problems through a combination of educating the public and advice. £45m of the fund has gone on frontline advice services paying for over 300 debt advisers in Citizens Advice Bureaux and other advice agencies. According to Citizens Advice, over 70,000 people facing money problems have been helped by these FIF services. The new government, though, is staying tight-lipped on whether it will renew the grants.

The delegates might have been tempted to enlist the support of their fellow temporary residents at the University of York, as the Church of England Synod was meeting at the same time on campus. This made for an interesting juxtaposition of discussions on seemingly intractable problems.

Rowan Williams, the Archbishop of Canterbury, cut a careworn figure in a corner of the refectory at breakfast time last Friday. Around the refectory his bishops and other clergy were discussing a compromise deal over women bishops. Meanwhile, the Citizens Advice delegates, often sharing the same tables as the clergy, discussed legal aid contracts and the FIF. Perhaps they could at least draw comfort from the fact that one person in the room was facing seemingly greater problems than their own?

Despite the bleak outlook last week Rowan Williams managed to put together a compromise on women bishops earlier this week. Perhaps his success at crafting an agreement can give hope to his temporary cohabitees from last week? Hopefully, the funding problems which Citizens Advice Bureaux and other advice providers face will be resolved with government rather than divine intervention, although at times like this I am sure they are willing to accept any help they can get.



Steve Hynes

Image: York University Conference hall- Legal Action Group