In a speech to the Liverpool Law Society last week, the Chair of the LSC, Sir Bill Callaghan, gave the broadest public indication so far of the LSC’s vision of contracting from April 2013, following the full implementation of the legal aid bill. He said:
The ongoing administration of new matter start allocations is now attracting particular attention because it takes a great deal of effort for both providers and LSC staff.
The removal of a fixed allocation of new matter starts is one idea that has been put to us by representative bodies. Fixed allocations mean that more popular providers often run out of work and are refused an increase while other providers in the area have unused matter starts.
A more open competition at client level would be one way of dealing with this issue and we think it should improve the quality of provision and client care.
What we’re talking about here is licensing civil contract work rather than simply allocating a fixed number of new matter starts.
There is still a lot discussion to be had about the detail of how this will work. But we envisage introducing this approach in April 2013 at the same time as the LSC is abolished and the new Executive Agency takes over.
This suggests that the tender round for civil and family work which is likely later this year, for contracts starting from April 2013, will be on a completely different basis to recent tenders. Instead of bidding for a fixed number of matter starts, organisations would either be able to do legal aid work or they would not; if they can do legal aid, they can do as much or as little as they can attract. Clients and the market – not the LSC – would decide who does the work.
In some respects, this would turn the wheel full circle to the situation that existed prior to the Access to Justice Act 1999, except that in those days any firm could do the work; in future, only those licensed by the LSC would be able to. But once licensed, how much work would be up to them not up to the LSC. No maximum matter starts, no 85% matter start KPI?
This approach would represent a significant change to how work is allocated and potentially significantly increase competition between providers. Although this approach is not yet guaranteed, providers would be wise to factor it into their long term business planning.