Legal Services Bill [HL]

My Lords, this has been a truly remarkable debate. In the compass ofless than three hours, it has ranged widely and penetratingly across the issues raised by this substantive Bill, which will have a profound effect on the handling of consumer complaints about the provision of legal services, the structuring of the legal profession and the regulation of legal services. It will have an effect also on the perception of the profession. If I have any note of complaint, it is not about the way in which the noble and learned Lord the Lord Chancellor presented these issues; it is rather that, at some points in the debate, there was an implication that the interests of the law profession and consumers were almost ineluctably opposed. The failure of a part of the profession to provide an adequate system for handling consumer complaints, of which the noble Lord, Lord Brennan, spoke trenchantly, is not an indication of anything that should lead to the legal profession being written off as being incapable of reform. That is clear in the response to the Bill from both the Bar Council and the Law Society, which have broadly welcomed the provisions, subject to some suggested amendments. The remarkable thing about the Bill—it is in some ways historic—is the detailed pre-legislative consideration that it has been given by the committee chaired by the noble Lord, Lord Hunt of Wirral. Candidly, I doubt that our parliamentary procedures are apt to deal with a Bill of such detail, complexity and size as effectively as has been the case in this instance by the committee of the noble Lord, Lord Hunt, the members of which have uniformly testified to his superior chairmanship. The noble and learned Lord the Lord Chancellor mentioned the pressing timetable under which the committee operated. I have no doubt that working to a timetable of eight weeks, as the noble Lord, Lord Neill of Bladen, said, presented its members with an extraordinarily difficult task, but it is clear that they have performed a high public service in the work that they have done. I have no doubt, too, that there will be further opportunities during the Bill’s passage through the House to raise points that may have come to light too late for the committee to have been able fully to consider in its deliberations. The general welcome for the purposes of the Bill is clear. It has united those such as the noble Lord, Lord Whitty, who spoke on behalf of consumers and who still hopes to see improvements made to the Bill to strengthen some of its provisions, and those who would like to be careful not to undermine the strength of the legal professions and their perceived independence—their independence in the eyes of those overseas who look covetously on their business. The legal professions generally provide an unrivalled service. I suppose that I should have declared a past, if not a present, interest in these issues, for I practised briefly at the Bar and served as a consultant for an American law firm for many years and as a consumer Minister in the late 1970s, for which I did not consider myself disqualified by virtue of my legal interest or training. The underlying question about regulation is whether it in some way jeopardises the independence of the new body. Is the Legal Services Board truly independent as it is being constituted? One can make too much of appointments being separated from the Secretary of State, but I cannot quite understand why the noble and learned Lord the Lord Chancellor takes such strong exception to consulting the Lord Chief Justice, as was proposed by Sir David Clementi. I cannot see that that consultation process would alter the perception of the work of the Legal Services Board, and I hope that the proposal will be reconsidered. Attention has been drawn by a number of those who have contributed so thoughtfully to this debate to the extraordinary number of times that the Bill provides for the intervention of the Secretary of State in the work of the Legal Services Board. We were assisted by the arithmetic of the noble Lord, Lord Hunt, who said that these powers could be exercised on 288 separate occasions. I believe that the noble and learned Lord the Lord Chancellor has in some respects modified some of these powers in the time between the committee’s report and the publication of the Bill in its present form, but the issue causes eyebrows to be raised. I hope that he will not rest in seeking to eliminate unnecessary interventions. Will the Secretary of State contemplate importing regulatory principles into the Bill, particularly that of proportionality? This could quieten some of the concerns that have been expressed about the necessarily wide and sweeping circumstances in which it is possible for the Legal Services Board to intervene. Another concern may be—I believe that it has been expressed by the Bar Council—that there is no direct provision for a right of appeal to the High Court on the conclusion on regulation by the Legal Services Board. I understand that recourse to judicial review will be available, but it may be thought that under Article 6 of the European Convention on Human Rights it is necessary to go further. Although that point has not been made so far in the debate, I would be interested to hear the noble Baroness, Lady Ashton, when she winds up, say whether she thinks that an Article 6 issue arises. That applies also to the provisions on the complaints procedures. Several noble Lords mentioned another important point. The noble and learned Lord the Lord Chancellor in his response to the Joint Committee indicated that he was considering the issue of the trigger as a regulatory action by the Legal Services Board, since it should clearly not be set too low. I hope that that will be animadverted on in the winding up. The single entry point for the complainant is very important. The complexities of service provision, cutting across all the different professions and organisations, make the system difficult for a lay man, as anyone who has served in another place will know. The only difficulty that I have in understanding how this is intended to work in practice is in respect of a complaint that is clearly about professional conduct. The natural route would be to the authorised regulatory body, but that cannot necessarily provide redress. Is it the view of the Government, and will it be clear in the Bill, that such complaints, although they will be ultimately handled by the professional regulatory bodies, should be channelled through the Office for Legal Complaints? Lay complainants will not necessarily have a view about whether or not it is appropriate to go to the professional bodies because the matter was primarily about conduct. It would be helpful to hear what the Government have in mind. The issue of redress has been raised again in the context of the appropriateness or otherwise of the ceiling of £20,000. I found the argument of the noble and learned Lord the Lord Chancellor very compelling on that point. As the power is being taken in the Bill to raise that level, considerations of its being too low might later cause changes to be made. But at this stage, in the light of the evidence on £15,000 as a summit of compensation awarded for legal inadequacies, what the Bill provides makes a good deal of sense. I do not agree with the noble Lord, Lord Whitty, on that point. The issue of who is to pay for the complaint is not so satisfactory. The suggestion that the burden should be borne entirely by the ““polluter”” seems somewhat doubtful. I have been able to find no suggestion in the Bill, although I have not combed it in such a way that would make me confident about my sleuth work, of how to deal with the problem of vexatious or frivolous complaints. Anyone who has had to deal with public complaints is quite aware that there are such complaints—and it would be wrong that the full burden of that should be borne by the person against whom the complaint was made. That raises the wider question whether there should be some sort of compensation fund. I look forward with interest to hearing what the Minister has to say about the Government’s consideration of that issue, which does not lie clearly on the face of the Bill. The Office for Legal Complaints deals with individual complaints. It is not entirely clear that it will have a specific role in advising how to amend procedures that have given rise to complaints or in advising about professional best practice. Is that intended to be part of the mandate of the Office for Legal Complaints? If it is not, there must be some kind of interface between the Office for Legal Complaints and the Legal Services Board to determine where that responsibility lies, because in that way we will improve our systems to enable a diminution in the total number of causes for complaint. I raise one question that may be thought to be of less importance than some others. What is to happen to the reports of the inquiry on particular complaints? Are they to be published? There are cost implications of doing that, but there are transparency virtues in publication, not simply because of naming and shaming but because publication could assist in determining what practices are acceptable and what are not. That merits examination in Committee, if not resolution this evening. Proposals on alternative business structureshave been driven very largely by competition considerations. I pay tribute to the noble Lord, Lord Borrie, whom I have known for some time, and his successors at the Office of Fair Trading, who have recognised that the one-stop shop argument is on the face of it attractive and that there are some sections of our community for which and parts of our country in which access to legal advice is not readily obtainable. However, unsurprisingly, I share the views of my noble friend Lord Thomas that these proposals will not necessarily deal with all the problems that arise on access and provision. I cite my own example of representing in another place a very sparsely populated rural constituency where there were important relationships between lawyers and clients. I wonder how such practitioners will be affected by the Tescos of this world. The rural issue has been raised, but I do not think that it has been answered. I hope, too, that the Minister may have something more to say on the potential conflicts of interest between the legal service providers and the shareholders, for example. Many of these questions seem to point to the necessity not of a headlong rush towards the establishment of these alternative business structures but of the cautious approach that I think the noble and learned Lord the Lord Chancellor was adumbrating. Finally, is it intended that, in the regulation of these business structures, the rules should be applicable to sectors or to individual applicants? The licensing is of individuals, but if the regulatory system is in place for a sector would it be automatic that a licence would be given if the criteria were observed? That is very important because we should not nod through structures that would be legally acceptable on the face of it but not apt for particular individual proposals.