Legal Services Bill [HL]

I am grateful to noble Lords for raising this important issue. I have a lot of sympathy with what the noble Lord, Lord Thomas of Gresford, has just said. Indeed, he is absolutely right: if significant redress were needed, one would go to the courts, and it would be right and proper to do so. This scheme is not trying to prevent anybody from doing that—far from it. Of course, people do not accept the determination before they do so, but they have the right to go to court; if there were significant financial loss of the kind that noble Lords have described, that would be exactly the right way to approach it. The key point is that the £20,000 limit is higher than the highest redress level currently operating in the legal services sector. I understand that at the Law Society the level is £15,000. We must also put this in the context of the average award. The Law Society’s average award is £450 and the Bar Council’s is £428—those are based on 2004-05 figures, which are the last figures that I have. We have made provision in the legislation to alter that limit if it seems appropriate. This will need to be used relatively regularly if only to take into account the effects of inflation. We have not put specific time limits on it, because we want to make it flexible enough to enable organisations to say that they think that it should be reviewed to take account either of what has happened or, as I indicated, of inflation. We also want to make sure that the new system beds down and to keep that sense of proportion that the noble Lord, Lord Thomas of Gresford, has referred to. As I indicated, if the ombudsmen are regularly hitting the upper limit, they can recommend that the limit be increased, after, of course, they have done the consultation. It is probably worth explaining, as the noble Lord, Lord Thomas of Gresford, did, what we are describing here, which is the damages element within the £20,000. If the complainant has expenses for bringing the complaint—they have had to travel to a hearing, or they had expenses of copying documents and so on—those expenses can be additionally given back. If there are fees to be paid back because of what has happened, they could be paid back quite separately to the £20,000 limit, in terms of what would be available as damages. It is not the end of the process in terms of the overarching figure; there are other things that people can claim. Having looked across the current position, we think that we have got this about right. There is, as I have indicated, the opportunity to review the figure when the organisations feel that it is necessary to do so: the OLC, the LSB and the Consumer Advisory Panel will be able to make recommendations at any time to alter it. Obviously, there will be powers under the Bill to publish and consult on the recommendations and so forth. On that basis, I hope that the noble Lords will not press their amendments.