Tory and Labour MPs on the Home Affairs Select Committee have slated the plans of the Lord Chancellor Lord Mackay to make poor litigants pay a minimum contribution to their legal aid costs.
"I suspect solicitors will pay the money out of their own pockets," Sir Ivan Lawrence, chair of the Tory committee, told top civil servants from the Lord Chancellor's Department. "What kind of disincentive is that?" He added: "People either have a reasonable case or they do not. They should not be stopped from pursuing a reasonable case."
Labour MP Gerald Bermingham said: "Imagine being a solicitor: a woman comes in saying her daughter has been run down on a crossing. You cannot lose that sort of case. Then you have got to tell her that she has got to pay something. No self-respecting solicitor in the land would do it."
The committee was reviewing the annual report of the Lord Chancellor's Department on 10 July but most questions were about Mackay's White Paper Striking The Balance.
Sir Thomas Legg, permanent secretary at the LCD, defended the planned minimum contribution, which is expected to be between £10 and £20, as a way of discouraging frivolous applicants and Ian Burns, head of the department's policy group, said that Mackay's intention was to make potential users of taxpayers' money think twice before launching litigation.
Burns also revealed that the Legal Aid Board's recently established special investigations unit, which means tests "apparently wealthy" applicants for legal aid, had probably already had success in deterring wealthy litigants.
He said one applicant had withdrawn his application for legal aid when told it would be referred to the unit and his finances investigated.
To date, 393 cases have been referred to the unit.
Legg revealed that the LAB had made legal aid fraud inquiries into 630 solicitors' firms in 1995-96.
The preliminary inquiries, usually over alleged Green Form abuse, included examining firm income over the past three years to analyse any unusual trends such as an explosion in claims, writing letters to the firm seeking explanations of claims or warning solicitors about breaches in regulations.
The majority of the inquiries concluded that no abuse had occurred. Only two solicitors were prosecuted: one was convicted and one acquitted. Seven cases were referred to police.
"It is the decision of the police and the Crown Prosecution Service. They may not think the case stands up even though the LAB does," said Legg.