PRICE COMPETITIVE TENDERING FOR CRIMINAL LEGAL AID – PROPOSALS IN ENGLAND
AND WALES
TRANSFORMING LEGAL AID
In April 2013, the Ministry of Justice (MoJ) introduced a consultation paper, Transforming
Legal Aid: delivering a more credible and efficient system. Along with a range of proposals
for reform in both civil and criminal legal aid, it proposed the introduction of price competitive
tendering for criminal legal aid services.
Although contracts for criminal legal aid have been in place in England and Wales for a
number of years, these have not previously included any element of price competition. The
key elements of the new proposal are set out in the following table:
Scope
Contract length
Geographical areas for the
procurement and delivery of
services
Number of contracts
Client Choice
Case allocation
Remuneration
Procurement process
Each provider would be required to provide full service
across the range of criminal justice cases in the relevant
area.
Three year contract term which could be extended by the
Government by up to two further years.
Services would be based on 42 geographical areas
generally based on the existing Criminal Justice System
Areas.
A set number of contracts (likely between four and 38)
would be available in each geographical area, based on
the volume of work in that area. Providers could bid for a
share of work in more than one area. It is expected that
there would be a total of around 400 contracts.
Each provider with a contract for an area would receive
an equal share of access to cases in the area.
Client choice would not be a factor in the allocation of
cases, and the same provider would be required to
provide services for the duration of the case.
In exceptional circumstances, such as conflict of interest,
it may be permitted to change from the allocated
provider.
Cases would be allocated equally between providers
within the relevant area, suggested either on a case by
case basis, or by duty slots.
Providers would submit a bid for each type of work.
Different categories of work would be remunerated in
different ways, for example, a block fee for all police
station work and a fixed fee for magistrates’ court cases.
Bids would be subject to a cap of 17.5% below current
rates.
A two stage process consisting of a pre-qualification
questionnaire to screen for suitability, followed by an
invitation to tender in two parts – quality/capacity, and
price.
The MoJ anticipates that this proposal would see existing providers needing to increase
capacity by, on average, 250% in order to be able to fulfil the terms of a contract. In order to
allow providers to absorb the reduction in rates and to enable longer term planning, client
choice is removed in this model to ensure a predictable level of business for each provider.
This proposal was met with a high degree of hostility from the legal profession and other
groups. Many considered the proposal completely unworkable, with the Law Society of
England and Wales (LSEW) commenting that it was “likely to push the justice system
beyond breaking point to a devastating collapse”. Key concerns focussed on the removal of
client choice, a reduction in quality and legal services, and the short timescales for
implementing such a major change.
LAW SOCIETY OF ENGLAND AND WALES – ALTERNATIVE PROPOSALS
In July 2013, the LSEW produced an alternative proposal seeking to address the
Government’s concerns relating to the existing system, including the need for savings, but
maintaining client choice and avoiding competition on price. Key elements of the LSEW’s
alternative proposal are:
Quality and capacity
framework
Duty scheme
Wasted costs orders
Defence costs surcharge
Rolling contracts would be automatically renewed as long
as the provider was compliant with the requirements of
the framework. The framework requirements would
increase incrementally each year leading to consolidation
over time.
Client choice would remain, and barriers to entry and exit
of providers would be reduced. Increased certainty
through clearly set criteria and the removal of short term
contracts would allow providers to develop and invest.
Reformed duty solicitor scheme to increase efficiency
and achieve significant savings. Allocation would be
based on the volume of duty work carried out by a
provider in the previous year.
Introduction of a polluter pays system with a set fee to be
paid by the responsible party to the other parties in a
case in situations of avoidable delay or additional cost
Introduction of a defence costs surcharge based on the
victims surcharge system, paid by those convicted of an
offence, with a variable rate determined by the severity of
the sentence imposed.
NEXT STEPS
In a statement issued on 1 July, the Justice Secretary confirmed that the proposals would be
modified to retain client choice, and that the MoJ was in discussions with the LSEW
regarding its alternative proposal. However, the statement also reinforced the need to make
savings, and to work towards market consolidation. The revised proposals and the outcomes
and analysis of the consultation are not yet available.