This week The Lawyer 100 survey reveals that lawyers are contributing more than two per cent of the UK's gross domestic product.
The flip side of the top 100 firms earning over u5bn in gross fees is that clients are spending a record amount for legal advice. The question they may start to ask is whether the 15.6 per cent year-on-year increase in gross fees is accompanied by a comparative increase in value for money.
Clients – specifically, finance directors – need to be convinced that legal advice is not a cost burden but an investment. Despite the pressure on in-house lawyers to keep costs down, they know good lawyering can make or break UK companies.
Law firms are not only an essential part of the UK economy but are also leading the UK's export drives and attracting inward investment. And they are ambassadors for UK business abroad. As our analysis reveals on pages 8-9, UK firms such as Clifford Chance are leading the race to help rebuild Kosovo's infrastructure.
How ironic then, that the Government's proposals for Limited Liability Partnerships (LLPs) are about to tie one arm behind UK firms' backs. In the draft bill, the Government plans to force UK LLPs to disclose accounts without requiring overseas LLPs to do likewise.
This is a ridiculous state of affairs. US partnerships will have access to sensitive information about rivals' finances. This can only be good news for US firms that are targeting the London market, poaching UK partners, winning UK clients and attempting mergers.
Taxing times ahead
The magic circle of commercial chambers will be watching developments at Pump Court Tax Chambers with great interest. In its drive to offer a one-stop shop it will steal in and cherry-pick the best barristers if there is any disaffection in the set. The tax sets have not diversified their practices, largely because it is such a narrow and highly profitable field, but they may now suffer as a result.
A merger of the leading sets may be the only way to preserve their position and avoid being consumed by the commercial giants.