Facing a barrage of swingeing spending cuts, local government lawyers are adamant they will emerge stronger than ever
The role of the UK’s public sector lawyer is about to change. Instead of bemoaning further cuts in spending – the deepest faced by British public services in more than 60 years – local authority legal teams are taking up the challenge with gusto.
That spirit was evident during The Lawyer’s recent public sector roundtable, where local authority legal heads from across the country spoke about how their jobs were becoming radically different. Every delegate had either applied for an alternative business structure (ABS) licence, set up a shared legal service or was piloting a new venture altogether.
“The local government I joined four years ago bears no resemblance to the one I’m in now,” observes Kent County Council principal lawyer Ben Watts, formerly a legal adviser for the Devon and Cornwall police force. “Legal budgets are diminishing and authorities are looking at moving towards ‘self-service’.”
With the DIY model in mind, Kent’s legal department is talking to technology providers to see if they can create an ‘internet banking’-style legal service so clients can do basic work themselves.
“We could then give straight to the client work we might have passed to a junior lawyer,” explains Watts, pointing to the savings the banking industry has made since introducing online banking. “It’s about making us more resilient to legal risk.”
Rounding out the idea with an
upbeat message, Watts makes it clear that these models would not equal downsizing. The council introduced a trainee scheme in September, with the London authorities of Merton, Kingston, Sutton and Richmond – together known as the South London Legal Partnership – following suit some months later.
“We need to grow in-house capacity rather than reduce it,” stresses Lambeth County Council’s director of law and governance Mark Hynes.
It is a refreshing message in a market that has seen significant downsizing of trainee numbers by many private practice firms. Magic circle firm Allen & Overy has said it will reduce its annual trainee intake from 105 to 85 as of 2015, while media boutique Wiggin, whose clients include 20th Century Fox and Virgin Media, has scrapped its scheme entirely.
But why add more trainees to an already squeezed department?
“A big part of our portfolio is challenging areas of adult and child welfare,” answers Watts. “But there are just not enough good quality childcare lawyers, so we want to develop our own.”
As well as training talent in specific areas of law, delegates suggest there are benefits in rejigging the internal structure.
“Local authorities need to mirror the private sector pyramid structure,” says Cambridgeshire Council director of law Quentin Baker. “There can sometimes be too many senior lawyers compared to the amount of paralegals and trainees.”
Getting away with merger
But how can this pyramid structure work if two departments merge? After all, a growing number of local authorities are responding to budget cuts by buddying up.
“A shared service can only work if it’s a takeover,” says one delegate, an opinion greeted by nods of agreement. “You don’t make the savings unless it’s a takeover – tough decisions need to be taken regarding who’s needed and how it’s going to be staffed.”
Too many councils are simply merging their teams without taking the difficult decisions over who does what, when and why, warns another.
“It’s a smokescreen,” chips in one. “There’s a lot of rhetoric out there, when nothing tangible is being delivered.”
So if shared services won’t do the trick, what will?
Panellists warn that legal teams at smaller boroughs face a threat to their very existence – in the next few years the sector will see the formation of ‘clusters’ of expertise as bigger authorities swallow up their smaller neighbours.
The subject of the moment is the ABS, with nearly all delegates having considered or pushed forward with ABS plans. Buckinghamshire and Harrow, the latter of which has a shared legal service with Barnet and a partnership with Bevan Brittan, have already applied for licences, while Lambeth, Cambridgeshire and Kent are seriously considering the option.
“We’re driven by a wish to reduce reliance on government grants,” explains Buckinghamshire head of legal Anne Davies, who applied for an ABS licence with Buckinghamshire and Milton Keynes Fire Authority in December.
“It’s difficult to justify having a strong corporate centre if you’re cutting services to vulnerable people, so we’re looking at increasing capacity in-house rather than outsourcing.”
Does that mean the role of the private sector lawyer is diminishing? Despite the drive to bring more in-house, delegates say external advisers have little to worry about.
“One of the roles of the private sector is scale,” adds Watts. “We have to deal with more areas of law and niche areas such as IP. They are there to do that.”
With proposed budgets for 2014/15 exposing further cuts, public sector legal teams are proving to be a forward-thinking bunch.
Around the table
Quentin Baker, director of law, property and governance, Cambridgeshire County Council
Des Brady, head of government, Thomson Reuters
Anne Davies, head of legal and democratic services, Buckinghamshire County Council
Catrin Griffiths, editor, The Lawyer
Mark Hynes, director of law and governance, Lambeth Council
Asmat Hussain, assistant director of legal, Enfield Council
Kirsten Maslen, editor of practical law (public sector), Thomson Reuters
Hugh Peart, director of legal and governance, Harrow Council
Ben Watts, principal lawyer, Kent County Council
Thomson Reuters is at the forefront of driving innovation in legal solutions through responding to our customers’ needs for tools that enable them to deliver efficient and agile services to their clients. Our company is committed to continually developing solutions to ensure our customers are investing in a solution fit for the future.
The legal services industry is transforming rapidly and this roundtable further highlighted that local government plays a significant role in legal innovation. As the local authorities represented proved, lawyers in local government are uniquely placed to innovate; they have been advising on complex delivery structures, whether public to public or PPPs, for many years, are used to large-scale change, and are necessarily versatile.
The focus in local authorities on commissioning rather than service provision has transformed the local government lawyer’s client base. At the same time, funding for back-office services is increasingly squeezed. Technology has also played a significant role in implementing self-help solutions for clients.
In this context, maintaining the status quo is not an option. The big questions around cost reduction, risk management and sustainable strategy are more important than ever and local government approaches to them are taking a variety of forms including shared services and traded services.
However these different approaches play out, the world of local authority law is going to be very different in 10 years’ time.
The alternative business structure (ABS) offers local government lawyers the opportunity to expand their offering to the private and third sectors and, ideally, self-fund. However, the creation and management of an ABS is not easy. As well as legal expertise, technical and commercial skills will be key.
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