Legal aid procurement challenge over after Government climbdown

The Government has bowed to the threat of litigation by criminal solicitors and suspended the introduction of changes to the legal aid system.

The Government had been facing a dual challenge to legal aid procurement in the form of a judicial review and related claims by around 100 firms. The case was recently listed as one of The Lawyer‘s top 20 cases of 2016.

The claimants were protesting against the way the Government carried out the awarding of new criminal legal aid contracts through the Legal Aid Agency’s e-tendering portal. A number of firms failed to receive all the contracts they bid for, others reportedly won contracts for regions they were not present in, while there were a ­number of reported issues with the notification process.

Michael Gove
Michael Gove

Lord Chancellor Michael Gove made the announcement that the contract process was being suspended in a written statement issued today (28 January 2016).

“Given how delicately balanced the arguments have always been, how important it is to ensure we maintain choice and quality in the provision of legal services, how supportive HMT [HM Treasury] have been of our broader reform agenda and how important it is to provide as much certainty as possible in the face of legal challenge, I have decided not to go ahead with the introduction of the dual contracting system,” Gove wrote.

He said the Government would also suspend for 12 months a proposed fee cut which was originally due to come into effect last July. That followed an earlier fee cut of 8.75 per cent to criminal legal aid fees which was implemented in March 2014.

“My decision is driven in part by the recognition that the litigation will be time consuming and costly for all parties, whatever the outcome. I do not want my department and the legal aid market to face months if not years of continuing uncertainty, and expensive litigation, while it is heard,” Gove added.

It is understood that the Legal Aid Agency has written to affected firms to tell them that as a consequence of Gove’s decision, “this litigation falls away”. The agency is seeking an order to dispose of the claims. Decisions on costs will be made in due course.

Gove also said that he would review progress on joint work with the profession to improve efficiency and quality at the beginning of 2017, and would return to decisions about the second fee cut in April 2017.

He added that he intended to appoint an “advisory council” of solicitors and barristers to help explore “how we can reduce unnecessary bureaucratic costs, eliminate waste and end continuing abuses within the current legal aid system”.

The move was welcomed by the Criminal Bar Association and the Law Society.

The litigation had been set down in two hearings. The judicial review, in which Bevan Brittan partner Emily Heard had instructed a team of counsel from 11KBW, was due to be heard in April before a part 7 claim involving the individual claimant firms in May. Bindmans and Trowers & Hamlins had recently been appointed to jointly case-manage the part 7 claim on behalf of all the claimants.

The legal line-up:

Judicial review

For the claimants, the Fair Crime Contract Alliance

11KBW’s Jason Coppel QC, Amy Rogers and Zoe Gannon, instructed by Bevan Brittan partner Emily Heard and solicitor Trevor Watt

For the defendant, the Legal Aid Agency

Keating Chambers’ Sarah Hannaford QC, Simon Taylor and David Gollancz and Outer Temple Chambers’ Fiona Scolding, instructed by the Government Legal Department

Part 7 claim

For the claimants

11KBW’s Jason Coppel QC, instructed by Bindmans partners John Halford and Jamie Potter and associates Salima Budhani, Ben Gaston and Caroline Robinson; 39 Essex Chambers’ Parishil Patel, instructed by Trowers & Hamlins partner Lucy James and senior associate Dan Butler

For the defendant, the Legal Aid Agency

Keating Chambers’ Sarah Hannaford QC, Simon Taylor and David Gollancz and Outer Temple Chambers’ Fiona Scolding, instructed by the Government Legal Department