Who should pay the cost of increasing complaints?

18/01/2018

As part of its annual budget consultation, the Scottish Legal Complaints Commission - Scotland’s independent body for complaints about lawyers - has called on members of the public, and legal professionals, to join the discussion about who should pay for the increasing cost of complaints about lawyers.  It is also consulting on how that funding should be arranged, following the Law Society of Scotland’s authorisation as an ‘Approved Regulator’ of new business models allowing non-solicitor ownership.

Increasing the efficiency and effectiveness of the complaints procedure will be a key focus of the SLCC’s proposed work plan for 2018-19, following a 14% rise in complaints against lawyers over the past two years.  Rising complaints, coupled with the end to a long-standing subsidy of costs from the Commission’s reserves, has led to a 5.2% increase in the SLCC’s proposed budget. In real terms this means that solicitors in private practice will pay an extra £30 next year (an 8.5% increase). For in-house lawyers this amounts to an extra £9 per year; for members of the Faculty of Advocates the rise is £14.

The increase in funding will be used to recruit new case workers to handle the increase in complaints.  At the same time, the SLCC will continue to provide support for lawyers to help them understand the common causes of disputes in order to reduce the potential for complaints within their own practices. It will also continue to campaign for legislative reform, particularly in relation to legal complaints and ways to achieve a more efficient and effective process, and has welcomed the current independent review of legal regulation.

Neil Stevenson, CEO said, “Complaints remain a tiny proportion of all legal work. However, as numbers increase, and those entering the later more costly stages of our process also rise, our costs increase.  We know that the vast majority of complaints come from a small number of practice areas.  Last year the Law Society of Scotland questioned the proportionality of the levy on certain groups within the profession, such as in-house lawyers, in the Society’s public response to our consultation.  In recognition of that, part of this year’s consultation opens up the question of how the levy might be divided among different groups of legal practitioners.  We are open to the views of the profession, and those of the wider public, about where we should be moving to: a levy that falls more on those areas that generate most complaints and costs or, conversely, a single rate for all lawyers.”

“This year also sees the first year a levy will be due from a legal services ‘Approved Regulator’ who will in turn be licensing ’alternative business structures‘ with non-lawyer ownership. The 2010 legislation enabling this anticipates that this funding will come from the new legal services market.  We see it as critical that the current levy for individual lawyers does not subsidise this new market.  However, we must also consult ‘Approved Regulators’ and take their views into account.”

“We recognise that as we were able to reduce the levy in previous years, through drawing on our limited reserves, an increase this year will not be welcome.  It was always our position that using reserves to subsidise the levy could not continue indefinitely. However, we have continued working to try to tackle the common causes of complaints through information to lawyers and consumers.  In the longer term, the best outcomes for the public and the legal profession will come from working collaboratively to reduce complaints, and therefore our workload and the obvious operating costs associated with that.

“We are also pleased to announce major saving this year, including the potential for over £80,000 over the next five years in terms of property costs and a significant reduction in legal costs, now last year’s legal challenges against us have been dealt with.”

Legislation sets out that the SLCC must consult each January, publish responses to the consultation in March, and lay a budget before the Scottish Parliament in April each year. The statute requires that the budget must be reasonably sufficient to cover expenditure. Both the draft Operating Plan and budget cover the period 1 July 2018 to 30 June 2019.

The draft Budget and Operating Plan are here:

 

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